Challenges coming to housing in 2022.
Watch the original video: 2022 Housing Market Forecast: Will it Crash or Boom?
Happy New Year. Here is my Monthly Mortgage Market Update for January 2022. In this month’s video I talk about 2022 Housing Market Predictions, volatile interest rates, and the new states we are licensed in.
Going into 2022 there is already a lot of news in the Real Estate Industry. A lot of people are asking, is this the year we are going to see the Housing Market crash? Or, is it a good time to buy a home? Below is a summary of each topic I discussed in the video, watch the video above to learn more.
📈 Interest Rates
For many of you that have been following the market, there has been a lot of talk about rates going up and inflation sweeping the nation. At the end of last year we saw inflation rates reach the highest level since 1982 as CPI spiked above 7%. To combat inflation the Government has begun raising the Federal Rate, indirectly impacting mortgage rates. They have announced they will also taper back on the asset purchase program and will utilize additional tools to slow inflation.
We have already seen the effects of these changes reflected in the stock market, interest rates and cryptocurrency.
However, let me remind you that although this seems alarming, historically rates are still incredibly low. Many of us have been spoiled in the past year with all time low interest rates, and we must take this into consideration. If rates rise into the mid 3s or low 4s in 2022, these will still be great rates.
🏠 Housing Market
Nationwide we continue to see LOW INVENTORY in the housing market. Homes priced aggressively are still receiving multiple offers and are moving quickly. That being said, in certain areas across the country we are noticing that buyer demand has slowed down. The reason we are seeing this is not because rates are rising, but because affordability has become a challenge for many buyers.
As we head into 2022, affordability is an issue that unfortunately will only get worse as rates continue to rise, especially as we move into the Spring and Summer months. Many experts predict that as we move forward the market will continue to be busy, but thankfully will not be as competitive as last year.
👷🏼♀️ New Construction
New construction is the biggest solution for the low inventory problem. Here in Shasta County, there are some large developments that are finishing up and some new construction that is just beginning. Although this will solve some inventory issues, experts predict it will still not be enough. If we go back to 2008-2010, when the housing market crisis started, there has not been enough new construction in the last decade to keep up with the demand of families that need housing. This issue is also why we have seen rent prices rise at such a fast rate.
⁉️ Is it a good time to buy a home?
Many are asking if it is a good time to buy or if they should wait. When asking this question, you need to consider your alternatives. For most people looking to buy right now, it’s because rents are being raised or their landlord is looking to sell the home and cash in on the home’s equity. The instability of being a renter is possibly the least stable it has ever been. That being said, my team and I will continue to observe the trends in the market and update you as things change.
If you have any questions about buying a home or refinancing I would love to hear from you. We are currently assisting many folks who are doing a cash-out refinance to pay off higher interest debt. Please let me know if this is something I can assist you with.
🙌🏼 Lastly, we are Licensed in New States..
My team and I are licensed and approving loans in California, Oregon, Washington, Idaho, Nevada, Arizona, and NOW Texas, Tennessee and Florida. If you or anyone you know is in the process of moving we would love to help you.
I look forward to talking with you soon and hope you have a wonderful day.