To succeed in today’s buyer’s market, it’s important to understand which market trends will have the greatest impact on your home search. Our team at Corken + Company has compiled two factors every buyer should keep their eyes on:
Mortgage rates and housing supply.
Here’s a look at each one.
Mortgage Rates Projected To Rise in 2022
As a buyer, your interest rate directly impacts how much you’ll pay on your monthly mortgage. Rates are beginning to rise, and experts forecast they’ll continue going up in 2022
Although mortgage rates are expected to climb next year, they’re still low. That presents today’s buyers with some motivation to lock in a low mortgage rate before they climb higher.
More Homes Are Expected To Be Available This Season
The other market condition buyers need to monitor is the number of homes available for sale today. The latest Existing Home Sales Report from the National Association of Realtors (NAR) shows the current inventory sits at just 2.4-months. To put that into perspective, a 6-month supply is ideal for a balanced market where there are enough homes to meet buyer demand.
However, there may be good news for buyers who are waiting for more options. A recent realtor.com survey shows more sellers are planning to list their homes this winter, meaning more choices will likely be available soon.
What Does That Mean for You?
Even if your options improve some this season, it won’t significantly shift market conditions overnight. According to NAR, many more listings need to be available to move closer to a more neutral market:
“Given the average monthly demand . . . , 3.55 million homes should be on the market to meet a level of inventory equal to six months of demand, implying a shortage of homes for sale of 2.24 million.”
So remember, competition among buyers will remain fierce as there still won’t be enough homes to meet the current demand. That means you’ll need to act quickly when you’re ready to make an offer.
If you’re planning on buying a home this winter, more options are welcome, but it doesn’t mean you should slow down. Work with your agent here at Corken + Company so you can be prepared to act as quickly as possible when the right home hits the market.