Gabrielle Ritter

Gabrielle Ritter World

— Bainbridge Island, Kitsap County WA —

Facts Around Selling Your Home

Last Updated on May 2, 2022, by Luke Feldbrugge

Welcome to the Housing Market Trends monthly update for May 2022 from Homes for Heroes. This report focuses on the residential real estate housing market and we attempt to provide useful information to assist our heroes with decision making regarding buying and selling a home, or refinancing their mortgage.

BULLETS: Housing Market Trends May 2022

  • Homes available for sale remain at historically low levels BUT active listings increased in March for the first time since September 2021.
  • Home prices will continue to steadily rise due to the low number of homes for sale.
  • Home loan interest rates are rising due to inflation. Experts are projecting interest rates to continue increasing throughout the year, but at a more moderate pace as inflation slows.
  • It remains a seller’s market with new listings selling in days due to limited options for buyers.
  • Buyers want to buy now before rates and prices get any higher.

Inflation, rising mortgage rates, low home inventory, and rising home prices are causing some buyers who are on the fence to exit the market.

But, there are no signs of the housing market slowing down. The market is busy right now with people trying to purchase or refinance before mortgage interest rates rise more.

RECOMMENDATION

Make a purchase or refinance a mortgage now if you’re in a position to do so as inflation, mortgage rates, and home prices are expected to increase throughout the year and into 2023.

Selling Your House Can Go Fast

A current housing market trend is that new home listings are going quick! New home listings sold faster than active listings in March. It’s been a while since that happened. But, what does that mean for someone who wants to sell their home? It means when you put your home on the market, it will move. FAST. That likely means numerous competitive offers at or above the asking price, no contingencies, and anything else a buyer can do to get a leg up on the other buyers who want your house.

Low Number of Homes for Sale

This continues to be the biggest issue in the U.S. today. There are not enough homes available for willing and able buyers. The graphic above shows buyer and seller traffic indexes for the U.S. in February 2022. The darker blue represents stronger traffic. The lighter the blue, the weaker the traffic. In general, the country has a strong buyer presence and a weak seller presence. But, this is not the case everywhere. Take a look at your state to find out what’s happening in your area.

THIS IS REASON TO CELEBRATE: Active listings increased in March for the first time since September 2021! Granted, it was a slight increase, but an increase nevertheless. Buyers will take all they can get in this crazy market.

Rising Interest Rates- What’s the Outlook?

Mortgage rates are projected to increase (driven primarily by low inventory and inflation) throughout the year but at a more moderate pace. Freddie Mac says, “Much of the increase in rates in early 2022 is in anticipation of what will happen later this year, especially with the Federal Reserve interest rate policy.” The Fed has raised its rates and mortgage rates typically follow the Fed’s lead, so knowing that’s done takes some of the uncertainty out of what’s to come.

What Happens to Home Prices When Mortgage Rates Rise?

 

Over the past 30 years, when interest rates rose more than one percent, home prices tended to increase. This year, inflation is causing mortgage interest rates to rise and historically speaking that can cause a slight decrease in home sales. This may potentially reduce buyer activity and price some buyers out of the market. That’s a good thing for buyers who remain in the market as it helps to reduce buyer competition. It also pulls some buyers who are on the fence into the market before inflation continues to rise and home loan interest rates get too high.

Home Prices Continue to Rise

 

Seven home pricing experts all agree that home prices will continue to rise this year. The average of the projected increase from all seven experts comes to 6.7 percent home price increase in 2022.

Home Appreciation – Should I Buy Right Now?

 

Think long-term if contemplating buying a home. Based on expert projections, if you purchase a $360,000 home this year, the projected home value will appreciate to more than $456,000 by 2027. That’s nearly a $100,000 gain in home equity in 6 years!

*** NOTE: The home price expectation survey is a survey of 100 economists, real estate professionals, and market investor professionals.

 

Shared from the original post at HFH.com