2021 hasn’t been easy for many home buyers. Despite the interest rates being at historic lows, many home buyersーespecially first-time buyersーstruggle because of the high competition and low inventory.
This has made it even more important to work with a trusted home-buying team. Unless you can purchase your dream house entirely in cash, buying a house means selecting the best type of mortgage and dealing with a tight time-frame to get all the contracts and requirements submitted before settlement date.
The pandemic has also made home buying a much tougher challenge. According to real estate broker Redfin, the average home price was $375,639 by the end of September 2021. This was about 13.6% higher than the previous year, and a whopping 30% from September of 2019, where the average home price was only $291,000.
If you’re thinking about buying a home in 2022, we’re pretty sure you’re wondering whether it’s a go or no-go. To help you with that, here are what you can expect for next year’s housing market.
Increased Inventory, Higher Prices
2022 could be a good time to buy a home because of the increasing inventory. Lately, more and more properties are being sold. Also, the fact that many would-be buyers have been priced out means there is less competition.
The downside, however, is that home prices continue to soar. And forecasts show that while the housing market is likely to wind down next year, the process will be stubbornly slow.
Over the past year, we’ve seen housing marketing suffer from a shortage of supply. There were just not enough homes on the market to accommodate the growing number of buyers.
Fannie Mae predicts a 7.9% increase in home prices, while Zillow projects a 14% price growth in the next 12 months. Predictions are everywhere, but the common ground is that home prices are far from getting low.
Things To Consider When Buying a House
Here are some things to keep in mind:
- Only buy a house that you can afford. Overspending a couple of hundred bucks or more just to get what you want can rack up costly debts that will haunt you for years. Worst, you could end up homeless. Set boundaries and stick to them.
- Ensure that your monthly housing costs are at a manageable percentage of your income. Housing costs include insurance, maintenance, and taxes.
- Choose a house in a neighborhood that you want to live in for an extended period. Unlike renters who can easily pack up and move, owning a house could mean being stuck in it for several years.
Start Prepping Now
Buying a house is an exciting leap to take. And with the competition set to low next year, it may be easier to buy a house in 2022 than this year. But be guided: there will be challenges.
Home prices are predicted to rise, so working on your budget now will be a good headstart. We also suggest finding an agent who can help you be competitive.
Select a home lender that will help you make the home buying process faster and smoother and can help you choose the mortgage option that best fits your needs and budget. Our industry-expert loan officers have helped several home buyers to get their dream home despite not having perfect finances.