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2022 Housing Market Forecast [INFOGRAPHIC]
![2022 Housing Market Forecast [INFOGRAPHIC] | MyKCM](https://files.mykcm.com/2022/05/05130426/20220506-MEM-1046x1885.png)
Some Highlights
- What does the rest of the year hold for the housing market? Here’s what experts have to say about what lies ahead.
- Home prices are projected to rise and so are mortgage rates. Experts are also forecasting another strong year for home sales as people move to meet their changing needs.
- Let’s connect so you can make your best move this year.
Three Tips for First-Time Homebuyers
Buying your first home is a major decision and an exciting milestone. Even though it can feel daunting at times, it has the power to change your life for the better. If you’re looking to purchase your first home, you may be wondering what’s happening in the housing market today, how much you need to save, and where to start.
Here are three things that can help give you the information you need to confidently pursue your dream of homeownership.
1. Consider All Options When the Number of Homes for Sale Is Low
Today, there are far more buyers in the market than there are homes available for sale. When that happens, it’s a good idea to do what you can to increase your pool of options. That could mean expanding your search to include additional housing types. For first-time buyers, considering condominiums (condos) and townhomes can be an excellent way to increase your choices. According to Bankrate:
“Townhomes often cost less than single-family homes of a similar size in the same location.”
In another article, Bankrate also says:
“Buying a condo can be a great way to dive into homeownership without worrying about the upkeep that comes with single-family homes and townhouses.”
Condos and townhomes are both great entryways into homeownership. When you buy either one, you can start building equity which increases your net worth and can fuel a future move.
2. Know Your Down Payment Could Be More Within Reach Than You Think
Saving for a down payment can feel like one of the biggest obstacles for homebuyers, but that doesn’t have to be the case. As the National Association of Realtors (NAR) says:
“One of the biggest misconceptions among housing consumers is what the typical down payment is and what amount is needed to enter homeownership.”
Data from NAR shows the median down payment hasn’t been over 20% since 2005. The graph below breaks down the median down payment by age group for recent homebuyers according to the 2022 Home Buyers and Sellers Generational Trends Report from NAR (see graph below):
Based on the data above, the median down payment for all homebuyers is only 13%. That’s well below the common misconception of 20%, and it’s even lower for younger buyers. This could mean you may not need to save as much for a down payment as you initially thought.
There are also down payment assistance programs available for many buyers. Not to mention, some loan options require as little as 3.5% (or even 0%) down for buyers who qualify. While there are advantages to putting 20% down, especially in today’s competitive market, know that you have options. To get more information on how much you may need to save and the help that’s available, talk with a professional.
3. Work with a Trusted Real Estate Advisor Throughout the Process
Finally, no matter where you’re at in your homeownership journey, the best way to make sure you’re set up for success is to work with a real estate professional.
If you’re just starting out, they can help you with the initial steps, like educating you on the process and connecting you with a trusted lender to get pre-approved. Once you’re ready to begin your search, a real estate professional can help you understand your local market and search for available homes. And when it’s time to make an offer, they’ll be an expert advisor and negotiator to help your offer stand out above the rest.
Bottom Line
Knowledge is key to succeeding on your homebuying journey. Knowing market trends, what you need for a down payment, and what options you have as a buyer today can give you the confidence you need to buy a home. Let’s connect so you have an expert on your side who can help you navigate the homebuying process.
Today’s Home Price Appreciation Is Great News for Existing Homeowners
If you’re planning to sell your home this season, rising prices are great news for you. But it’s important to understand why prices are rising to begin with. One major factor is supply and demand.
In any industry, when there are more buyers for an item than there are of that item available, prices naturally rise. In those situations, buyers are willing to pay more to get the product or service they’re looking for when options are scarce. And that’s exactly what’s happening in the current real estate market.
Selma Hepp, Executive, Research & Insights and Deputy Chief Economist at CoreLogic, puts it like this:
“With so few homes, buyers are once again left with fierce competition that’s driving the share of homes that sold over the listing price up to 66% . . . With the continued imbalance between supply and demand, home prices are likely to have another year of strong gains and are expected to average about 10% growth for the year.”
Because it will take some time for housing supply to increase, experts believe prices will continue rising. The latest Home Price Expectations Survey forecasts what will happen with home prices over the next 5 years. As the graph below shows, while the rate of appreciation will moderate over the next few years, prices will continue rising through 2026:
What This Means When You Sell Your House
If you’re a homeowner, the projection for continued price appreciation this year opens up an opportunity to move. That’s because it may give your equity a major boost. Equity is the difference between what you owe on your house and its market value. The amount of equity you have increases as you make your monthly payments and as rising home prices drive up the market value for your home.
Growing equity is a powerful tool for homeowners. When you sell your house, the equity you’ve built comes back to you in the sale. That money could be enough to cover some (if not all) of your down payment on your next home.
Of course, if you want to know how much equity you have in your current house, it’s crucial to work with a real estate professional. They follow current market trends and can help you understand your home’s value when you’re ready to sell.
What This Means for Your Next Purchase
But today’s rising home values aren’t just good news if you’re ready to sell. Because price appreciation is forecast to continue in the years ahead, you can rest assured your next home will be an investment that should grow in value with time. That’s one of several reasons why real estate has been rated the best investment in a recent Gallup poll.
Bottom Line
If you’re weighing whether or not you should sell your house this season, know rising home values may be opening up an opportunity to use equity to fuel your move. Let’s connect so you can find out how much your home is worth and to learn more about all the benefits you have in today’s market.
What You Need To Know About Selling in a Sellers’ Market
Even if you haven’t been following real estate news, you’ve likely heard about the current sellers’ market. That’s because there’s a lot of talk about how strong market conditions are for people who want to sell their houses. But if you’re thinking about listing your house, you probably want to know: what does being in a sellers’ market really mean?
What Is a Sellers’ Market?
The latest Existing Home Sales Report from the National Association of Realtors (NAR) shows housing supply is still very low. There’s a 2-month supply of homes at the current sales pace.
Historically, a 6-month supply is necessary for a normal or neutral market where there are enough homes available for active buyers. That puts today deep in sellers’ market territory (see graph below):
What Does This Mean for You When You Sell?
When the supply of houses for sale is as low as it is right now, it’s much harder for buyers to find homes to purchase. That creates increased competition among purchasers which can lead to more bidding wars. And if buyers know they may be entering a bidding war, they’re going to do their best to submit a very attractive offer upfront. This could drive the final price of your house up.
And because mortgage rates and home prices are climbing, serious buyers are motivated to make their purchase soon, before those two things rise further. That means, if you put your house on the market while supply is still low, it will likely get a lot of attention from competitive buyers.
Bottom Line
The current real estate market has incredible opportunities for homeowners looking to make a move. Listing your house this season means you’ll be in front of serious buyers who are ready to buy. Let’s connect so you can jumpstart the selling process.
Congratulations to the Kimiecik Team!
Congratulations to Chis and Megan Kimiecik for reaching not 1 but 2 new personal bests!
Teamwork makes the dream work and Chris and Megan are reaching impressive new milestones in 2022. In March alone this amazing team brought in a whopping $1,877,500 in sales volume. This brings their first-quarter sales volume to $2,474,500! Not only was this their best quarter yet but they have already surpassed their 2021 sales volume in only the first quarter of 2022!
Now that’s something to celebrate!
April 2022 Housing Market Update
Geoff Green is President of Green Team Realty and Co-founder and CEO of NuOp. In addition, he is the moderator of the monthly Housing Market Updates. With so many changes in the market, Geoff began the April 2022 Housing Market Update with information on rising mortgage rates.
If you haven’t yet seen the April 2022 Housing Market Update or would like to watch it again, it’s available below.
Geoff provided some historical perspectives on rising rates and their impact. With statistics going back to 1993, it appears that prices will continue to climb even as rates are climbing.
Spring Market
Buyer traffic is very strong. Inventory continues to be very low. However, there has been a slight bump in active listings for the first time in 6 months. According to Lance Lambert, Editorial Director, Fortune,
“…some experts say that 2022 spring housing market might go down as one of the most competitive on record.”
Home Sale Price
The year-over-year stats show that sales prices are not going backward.
Meet our Panel
Vikki Garby, of Green Team New York Realty and Michael Giannetto of CrossCountry Mortgage, joined Geoff for their take on the market. To watch the panel discussion, click here.
Thanks to our Sponsor
NuOp is the Business Opportunity Exchange. View a live feed of Real Estate and Mortgage Referrals on NuOp.com
Sign up for Housing Market Updates
Join us for our next Housing Market Update on May 15, 2022. To stay informed and sign up for our housing market updates, click here.
Is It Time To Buy a Smaller Home?
Life events can have a major impact on what you need from your home, and retirement is one of the biggest changes many of us face. This period of your life can mean doing more of the things you enjoy, like traveling, visiting with loved ones, or taking on new hobbies. But what does that mean for your home?
If you’re looking for ways to focus more on the important things in your life, the answer could be downsizing. A recent article from The Balance talks about why it could be a great option, saying:
“There are many reasons to buy a smaller home—or to downsize from your present home—but sometimes, the idea that “less is more” is what propels homeowners to buy a smaller home.”
You Can Find the Right Home for Your Needs
The 2022 Home Buyers and Sellers Generational Trends from the National Association of Realtors (NAR) provides more information on why people of retirement age choose to move. It shows the need for a smaller home, the desire to be closer to loved ones, and retirement itself as three of the top reasons homebuyers over the age of 55 make a move.
If you’re in this group, changing priorities may be top of mind for you today, and that could be driving your decision to downsize. After all, as your lifestyle changes, what you need in your home likely changes, too.
Plus, as The Balance notes, moving into a smaller home can open your schedule up even more. When you downsize, you can spend less time maintaining your home and more time with the people you love or exploring newfound hobbies. That’s a recipe that can lead to less stress and increased happiness.
Your Equity Can Make a Big Impact When You Downsize
Home equity plays a big role when you sell your existing house and move. It could be a great tool to use to help you downsize. According to the latest Homeowner Equity Insights report from CoreLogic, the average homeowner gained about $55,300 in equity over the past 12 months. Dr. Frank Nothaft, Chief Economist at CoreLogic, explains how important price appreciation and equity gains are for existing homeowners:
“Home prices rose 18% during 2021 in the CoreLogic Home Price Index, the largest annual gain recorded in its 45-year history, generating a big increase in home equity wealth, . . . For low- and moderate-income homeowners, home equity has historically been a major source of wealth.”
As home prices rise, your equity does, too. So, you may have more equity than you realize because of the record levels of home price appreciation over the past year. Those equity gains could allow you to make a larger down payment on your next home. And putting more money down can lead to a smaller monthly mortgage payment, which can give you greater financial freedom. It can also be a significant help in navigating today’s competitive housing market, since offering more money up front could help your offer stand out.
Whatever your homeownership goals are, a trusted real estate advisor can help you to find the best option for your situation. They’ll help you sell your current home and guide you as you buy your next one and enter this new phase of life.
Bottom Line
If you’ve recently retired or plan to soon, your needs are likely changing. That means now may be the perfect time to downsize. Let’s connect so we can work together to find a home that matches your situation.
On the Fence of Whether or Not To Move This Spring? Consider This.
If you’re thinking of selling your house, it may be because you’ve heard prices are rising, listings are going fast, and sellers are getting multiple offers on their homes. But why are conditions so good for sellers today? And what can you expect when you move? To help answer both of those questions, let’s turn to the data.
Today, there are far more buyers looking for homes than sellers listing their houses. Here are the maps of the latest buyer and seller traffic from the National Association of Realtors (NAR) to help paint the picture of what this looks like:
Notice how much darker the blues are on the left. This shows buyer traffic is strong today. In contrast, the much lighter blues on the right indicate weak or very weak seller traffic. In a nutshell, the demand for homes is significantly greater than what’s available to purchase.
What That Means for You
You have an incredible advantage when you sell your house under these conditions. Since buyer demand is so high at a time when seller traffic is so low, there’s a good chance buyers will be competing for your house.
According to NAR, in February, the average home sold got 4.8 offers. When buyers have to compete with one another like this, they’ll do everything they can to make their offer stand out. This could play to your favor and mean you’ll see things like waived contingencies, offers over asking price, earnest money deposits, and more. Selling when demand is high and supply is low sets you up for a big win.
If you’re also looking to buy a house, you may be tempted to focus more on just the seller traffic map and wonder if it means you’ll have trouble finding your next home. But remember this: perspective is key. As Danielle Hale, Chief Economist at realtor.com, says:
“The limited number of homes for sale is a lesson in perspective. This same stat that frustrates would-be homebuyers also means that today’s home sellers enjoy more limited competition than last year’s home sellers.”
If you look at the big picture, the opportunity you have as a seller today is unprecedented. Last year was a hot sellers’ market. This year, inventory is even lower, and that means an even bigger opportunity for you. Even though finding your next home in a market with low inventory can be challenging, is that concern worth passing on some of the best conditions sellers have ever seen?
As added peace of mind, remember real estate professionals have been juggling this imbalance of supply and demand for nearly two years, and they know how to help both buyers and sellers find success when they move. A skilled agent can help you capitalize on the great opportunity you have as a seller today and guide you through the buying process until you find the perfect place to call your next home.
Bottom Line
If you’re ready to move, you have an incredible opportunity in front of you today. Trust the experts. Let’s connect so you have expertise on your side that can help you win when you sell and when you buy.
Using Your Tax Refund To Achieve Your Homeownership Goals This Year
If you’re buying or selling a home this year, you’re likely saving up for a variety of expenses. For buyers, that might include things like your down payment and closing costs. And for sellers, you’re probably working on a bit of spring cleaning and maintenance to spruce up your house before you list it.
Either way, any money you get back from your taxes can help you achieve your goals. Using a tax refund is a common tactic for buyers and sellers. SmartAsset estimates the average American will receive a $2,897 tax refund this year. The map below provides a more detailed estimate by state:
If you’re getting a refund this year, here are a few tips to help with your home purchase or sale this season.
How Buyers Can Use Their Tax Refund
According to American Financing, there are multiple ways your refund check can help you as a homebuyer. A few include:
- Growing your down payment fund – If you haven’t started saving for your down payment, let your tax refund kick off the process. And if you have a fund already, the money you get back could put you closer to your goal.
- Paying for your home inspection – Your home inspection can save you a lot of headaches down the road by helping you determine the condition of the house. As a buyer, you’ll typically be responsible for paying for your inspection, and it’s definitely worth the investment.
- Saving for closing costs – Closing costs are additional expenses you’ll need to pay once it’s time to close. They average anywhere between 2-5% of the purchase price of your home.
This list is a great start, but it isn’t exhaustive of all the costs you may encounter as you set out on your homebuying journey. The best way to prepare is to work with a trusted real estate professional to make sure you understand what’s to come in the process.
How Sellers Can Use Their Tax Refund
If you own a home and are planning to sell this spring, your tax refund can help you make sure your home is ready to list. Here are a few ways current homeowners can put their tax refund to good use:
- Making small upgrades – NerdWallet provides a list of great ways to use your tax refund, including tackling small projects or boosting your curb appeal to help your home stand out.
- Making repairs – If there’s anything in your house that needs to be fixed, American Financing notes that completing repairs is another great use of that money.
- Buying your next home – Whether you’re selling to move up or downsize, you can use your tax refund to help pay for any costs on the purchase of your next home.
Of course, it’s important to talk with your trusted real estate advisor before taking on any projects. They’ll make sure you can focus on areas that’ll help you receive the best possible price when you sell.
Bottom Line
Funding your home purchase or sale can feel like a daunting task, but it doesn’t have to be. Your tax refund can help you reach your goals. Let’s connect to discuss how you can start on your journey.
Why a Real Estate Professional Is Key When Selling Your House
With today’s real estate market moving as fast as it is, working with a real estate professional is more essential than ever. They have the skills, experience, and expertise it takes to navigate the highly detailed and involved process of selling a home. That may be why the percentage of people who list their houses on their own, known as a FSBO or For Sale By Owner, has reached its lowest point since 1985 (see graph below):
Here are five reasons why selling with a real estate professional makes more sense, even in today’s hot market:
1. They Know What Buyers Want To See
Before you decide which projects and repairs to take on, connect with a real estate professional. They have first-hand experience with today’s buyers, what they expect, and what you need to do to make sure your house shows well.
If you don’t lean on their expertise, you may spend your time and money on something that isn’t essential. That’s because, in today’s low-inventory market, buyers are willing to take on more of the renovation work themselves. A survey from Freddie Mac finds that:
“. . . nearly two-in-five potential homebuyers would consider purchasing a home requiring renovations.”
A professional can help you decide what you need to tackle. It’s not canned advice you could find online – it’s recommendations specific to your house and your area.
2. They Help Maximize Your Buyer Pool
Today, the average home is getting 4.8 offers per sale according to recent data from the National Association of Realtors (NAR), and that competition is pushing prices up. While that’s promising for you as a seller, it’s important to understand your agent’s role in bringing buyers in.
Real estate professionals have an assortment of tools at their disposal, such as social media followers, agency resources, and the MLS to ensure your house is viewed by the most buyers. According to realtor.com:
“Only licensed real estate agents can list homes on the MLS, which is a one-stop online shop of sorts for getting a house seen by thousands of agents and home buyers. . . . This is certainly one of many good reasons why the majority of home sellers decide to employ the services of a listing agent rather than going it alone.”
Without access to these tools, your buyer pool is limited. And you want more buyers to view your house since buyer competition can drive your final sales price higher.
3. They Understand the Fine Print
Today, more disclosures and regulations are mandatory when selling a house. That means the number of legal documents you’ll need to juggle is growing. That’s why Investopedia says:
“One of the biggest risks of FSBO is not having the experience or expertise to navigate all of the legal and regulatory requirements that come with selling a home.”
A real estate professional knows exactly what needs to happen, what all the paperwork means, and how to work through it efficiently. They’ll help you review the documents and avoid any costly missteps that could occur if you try to handle them on your own.
4. They’re Trained Negotiators
If you sell without a professional, you’ll also be solely responsible for all the negotiations. That means you’ll have to coordinate with:
- The buyer, who wants the best deal possible
- The buyer’s agent, who will use their expertise to advocate for the buyer
- The inspection company, which works for the buyer and will almost always find concerns with the house
- The appraiser, who assesses the property’s value to protect the lender
Instead of going toe-to-toe with all these parties alone, lean on an expert. They’ll know what levers to pull, how to address everyone’s concerns, and when you may want to get a second opinion.
5. They Know How To Set the Right Price for Your House
If you sell your house on your own, you may over or undershoot your asking price. That could mean you’ll leave money on the table because you priced it too low or your house will sit on the market because you priced it too high. Pricing a house requires expertise. Investopedia explains it like this:
“. . . There is no easy or universal way to determine market value for real estate.”
Real estate professionals know the ins and outs of how to price your house accurately and competitively. To do so, they compare your house to recently sold homes in your area and factor in the current condition of your house. These factors are key to making sure it’s priced to move quickly while still getting you the highest possible final sale price.
Bottom Line
There’s a lot that goes into selling your house. Instead of tackling it alone, let’s connect so you have an expert on your side throughout the entire process.
