Is the real estate market finally cooling off?.
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Monthly Mortgage Market Update for December 2021. In this month’s video I talk about where the housing market is headed, factors that will effect the market and current interest rates. Watch the video above to learn more. (Below is a summary of each topic I discussed in the video)
I cannot believe we are already at the end of the year. It has been an incredible year, many challenges but also lots of joy. I hope that you and your family are doing well.
🔮 2022 Predictions
As we head into 2022, everyone is wondering what will happen next. The truth is, no one can predict the market, but I am going to share with you what I have learned in the past few weeks.
What we know for a fact is that inflation is a looming threat to our economy. The federal reserve finally came forward and admitted this fact. As a result they could accelerate some of their plans to rise the federal interest rates. This will cause a few changes in the stock and bond market which would in-turn cause interest rates to rise. We are also seeing indications of a weak economy. The unemployment rate is still high, especially during the holiday season, the supply chain is struggling and there are continuing problems with Covid-19.
From everything I have read and learned, 2022 is going to be a sort of mixed bag when it comes to housing and interest rates. I believe the effects of the market will be felt differently depending on where you are looking at geographically. For example, Tennessee is one of the hottest states in America, and there are a lot more people moving to that area, than any other state in the Country. Here in Redding, we are still experiencing an influx of families and businesses, which has and will continue to affect our local market. So when speaking of trends in the housing market we have to look at specific areas, as not all places will be affected similarly.
📉 Interest Rates
Mortgage rates are continuing to rise. However, rates are still very good, and are in the low 3s depending on the type of loan. This is a .5 percent higher than they were at this time last year. As we head forward into next year it is still up in the air what will happen. There are two outcomes that we could see; either we will see a slow trend upwards, or we could see some volatility in the market. Things that would create an unstable market include; continued issues with Covid and new variants that may be vaccine resistant or inflation could become hyperinflation and the markets would move dramatically. These possibilities could easily make rates rise or fall dramatically, and I would not be surprised if we saw all time low interest rates yet again next year. We will definitely continue to keep an eye on this and update you as we learn more.
🏠 Is Now Still a Good Time To Buy?
Most people buying a home are still receiving great deals due to rates still being low. If you would compare what it costs to rent a house in most markets, to what it would cost to buy a home, taking into consideration the tax write off and all the other benefits, most people are still deciding that buying a house is the better option. Yes, even at these prices, it still makes more sense to purchase a home in this market.
🙏🏽 Thank You.
Lastly, I want to wish you and your family a Merry Christmas. Thank you so much to everyone who has supported me this last year and beyond. Our team did 95% of our closed loans from referrals last year. We have such an amazing community that supports us, thank you.
Please reach out if there is anything I can help you with. I hope you have a great end of the year. Looking forward to a happy and healthy New Year.