As you may have heard, 2021 was a wild ride in many ways, including in the real estate market. After month after month of increasing prices and bidding wars, thing finally cooled down a bit in November and December. Sale prices continued to inch closer and closer to 100% of asking (see below). While we’re still not anywhere close to a “healthy” market, there’s a chance we can take a breath this year.
Prices leveled off over the holidays as more people traveled and took some time to celebrate, though with limited inventory, prices held steady:
What Does This Mean for 2022?
At this point, we can predict with a reasonable amount of certainty that no one really knows how this year will go. While we all continue to learn how to deal with COVID, the virus continues to evolve. We’re not even going to speculate what will happen next as the virus continues to impact…everything.
What we do know is that people are always moving, and that’s not going to stop. Baby Boomers are staying in their homes longer, Millennials and Gen Z are entering their household-forming years, and the construction industry is struggling to keep up with demand. Even after 2020’s late winter lockdown, real estate agents, buyers, sellers, lenders, and escrow officers kept home sales moving along.
The current lack of inventory is almost certainly going to continue for years to come, at least.
Interest rates will eventually rise this year, which may force more and more buyers out of the market. How much rates go up and how much of an impact there is remains to be seen.
We Hope
For now, Happy New Year to all and may you stay healthy! Our hope is that the market continues to hold steady and reasonably predictable in 2022. (By that, we mean like, 8-10% year-over-year increases at most. Not ~20% increases and homes selling in hours. None of us need more stress, right?).