Austin won’t see traditional winter market breaks as we bring 2021 to a close. Single-family home rentals and apartment leases are beginning to expire and rental prices continue to rise. These factors make homeownership and regular monthly mortgage payments attractive to those willing to buy. The intense housing market last year scared off homebuyers and now they will return to looking for homes early in the new year. As a 2022 homebuyer, be on the lookout for inventory, mortgage rates,
If you are planning to buy in the new year, you still need to stay organized and prepared. It might feel less competitive, but the market will still not yield itself to indecision moving forward. Sellers will remain in control and want to get their homes listed for the right price now. They don’t want to wait for mortgage rates to inevitably rise over the next 4 to 6 months. An increase in mortgage rates will cause listing prices to drop.
Inventory Forecast for Homebuyers
Homebuyers who postponed their purchase plans to 2021 may find more inventory in the market in 2022. There could be more inventory because of increased home construction, flexible working conditions, an expected increase in distressed sales, and owners wishing to upgrade or relocate. Some homeowners will want to take advantage of lower mortgage rates early in the new year and search for more accommodating homes before interest rates rise toward the end of the first quarter.
While new home construction has seen an uptick, there are still issues. General supply chain challenges like unexpected delays and cost increases will continue into the new year. 2022 homeowners’ should contact a home builder or contractor quickly to start the home building process.
Several businesses are building and expanding in the Austin area. Many employers seek to attract and retain talent by offering remote options and flexible working conditions. This kind of flexibility could encourage people to sell their homes close to the city and move to the quieter suburbs. Work-from-home options will also allow buyers to broaden their home search parameters further from metropolitan areas.
Throughout 2022, employment and income growth are expected to rise. But, the end of the Foreclosure moratorium and the CARES Act forbearance program will likely lead to an increase in the available stock of real estate owned (REO ) listings. However, inventory due to payment defaults is expected to remain low.
Mortgage Rate Forecast for 2022 Homebuyers
The 30-year fixed mortgage rate is expected to rise slowly from the current 3% to a peak of 3.7% by the end of 2022. Daryl Fairweather, Chief Economist for Redfin, stated that “this low price growth will likely discourage speculators from entering the market, giving first-time homebuyers a better chance at securing a home.” The predicted hike in mortgage rates will not hurt home sales in and around Austin. This is due to the plethora of job opportunities, investor demand, and the steady population influx.
Future Forecast for 2022 Homebuyers
Expect house prices to remain competitive in 2022 and the market to slow down a bit gradually. However, anything will appear to be slower compared to the unprecedented year Americans have just experienced. This past year has been recorded as the fastest market in US history.
Contact Prism Realty today for a Complimentary Market Analysis.
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