After the response to Covid-19, 2021 was a challenging year for buyers in the Inlet Beach housing market. Real estate values outpaced predictions. Supply chain squeezes and heightened demand put pressure on housing supply, and the market responded with skyrocketing prices. People wonder if this trend will continue or if we’ll see things start to turn around.
While 2021 is a done deal, there’s still plenty of time for 2022 to surprise us. Read on to find out what the experts forecast for 2022 and what we might see going into 2023.
Home Mortgages and Interest Rates
Experts predicted a gradual rise in average mortgage interest rates in 2022. While average interest rates hovered a little over 3% during 2021, by July 2022, they had hit 5.5%. We have seen some leveling off. Most of this increase is attributed to the Fed’s rate hike.
But, based on Freddie Mac’s quarterly forecast and other prominent sources, we expect that rate to fall back to somewhere in the range of 4.5% by the end of 2022.
If you’re worried about high interest rates while buying a home, you can mitigate your personal interest burden by attaining and maintaining a healthy credit score. Better scores tend to qualify for better rates.
Housing Market Prices
After seeing the astronomical rise of home prices in 2021, many people wonder where we’ll land on housing prices in 2022.
Most predict a slowdown of price increases relative to those we saw in 2021. Unfortunately, buyers likely won’t see a steep price drop anytime soon. Don’t hold your breath for a dramatic reset of property values in 2023.
In an environment of rising prices, buyers will need to be more sure they can afford the costs involved in purchasing a house. Consider researching the total cost you should expect before making a serious decision, as there’s always more to a transaction than the listed price.
Property Values and Appraisals
Home values are not entirely coupled to home prices. Value is a matter of the appraised worth of the property, not the price the house can demand on the market at the moment.
That said, the relationship between price and value should be apparent. Expect values to continue to rise as the year progresses, just as a competitive market has driven up prices.
Changing Demographics, Changing Market
Millennials are increasingly aging into home buying. People in the age range of 26 – 41 comprise the largest group of first-time home buyers.
More and more of this demographic are moving into the world of homeownership, so this will continue to pressure the existing housing market supply.
If you’re in this group, or you’re a first-time home-buyer more generally, don’t forget there are unique resources designed to accommodate first-time home buyers. You’ll have access to government-backed mortgages with considerably lower down-payment requirements. You will probably also qualify for special assistance programs designed for first-timers.
Tackle Today’s Market With Counts Real Estate
Take advantage of the professional service and expertise of Counts Real Estate Group in and around Inlet Beach, Florida, to meet your property goals. Whether you’re a first-time home buyer or planning to sell, we can help you with any real estate transaction.