The last couple of years in the real estate market have been anything but what is considered normal. The first half of this current year has been interesting, to say the least. The rapid and very sharp incline of mortgage rates took several by surprise as the housing inventory remained below what many predicted.
If you are planning to take part in a real estate transaction or are just own a home and like to remain educated about the state of the market it is important to know what you can expect from the housing market in the upcoming months. There’s no way to tell for certain what will actually happen but there are some facts and trends that experts follow to help get some insight into where the real estate market could be headed in the near future.
Three of the biggest predictions for the real estate market for the end of 2022
Rates are expected to remain high but increases are expected to slow down
Just since January 1 the increase in the average mortgage rate has significantly increased. Most of this is from the Federal Reserve's rate hikes. The Federal Reserve, or Fed, as some market experts refer to it does not set interest rates in itself but the actions that they have taken do play a significant influencing role on mortgage rates. The Fed has communicated that there are more rate hikes planned over the course of 2022 and to prepare for mortgage rates to remain higher throughout the year.
Current mortgage rates are at their highest level for the last 13 years. It could continue to increase but they are not expected to take the sharp increase that it did through the beginning of the year.
There will be homes for sale but not many more
March showed inventory numbers of unsold homes at 950,000 properties according to the National Association of Realtors. This is a good increase as compared to the month of February but this number of homes is still only about a two month supply. It is said that a six-month supply is a healthy and balanced real estate market meaning that we are still in a seller's market.
The number of homes for sale is increasing and it is expected that there will be a continued study increase as the year progresses. More market experts are attributing this to homeowners being less likely to be fearful of the different aspects of uncertainty that the pandemic brought with it. However, buyers should not hold off on expectations of a significant increase of homes for sale.
Home prices will stay at higher levels
Even though the number of homes for sale is expected to increase there are still more buyers interested in homes than sellers selling them. This means that home prices will continue to increase with the supply and demand. This means buyers of all levels will need to prepare to be more patient when purchasing a home over the next year especially if you are purchasing a home at a budget point that the majority of other buyers are at as well.
The median existing-home sale price across the country saw an average of $375,300. This shows a 15% gain year over year in home prices across the country. Prices are expected to see a continued increase but at a steadier pace. This information helps to solidify that though mortgage rates are higher it can save a lot of money to purchase a home sooner rather than later when there might be more inventory.
For more information on purchasing a home in Portland and surrounding areas please contact us anytime.