When Will The Real Estate Market Shift? We all know it has been a strong sellers market nationally and locally for quite some time. During most of this time we have had historically low
Will The Real Estate Market Crash In 2022
Dated: April 29 2022
When Will The Real Estate Market Shift?
We all know it has been a strong sellers market nationally and locally for quite some time. During most of this time we have had historically low interest rates that have fueled the white hot housing market. What has recently happened and going to continue to happen during the foreseeable future are interest rate hikes. Interest rates are currently above 5% and expected to be raised multiple times during 2022. When interest rates occur buyers lose some of their purchasing power. The home they once qualified may no longer be available due to the increase in rates. When they once qualified for a $500,000 mortgage, with one rate hike their purchase power may drop down to $450,000. The thing is that this will impact every financed buyer with every individual hike. If enough of these hikes occur to make the buyers lose interest in purchasing a home, we could see the inventory start to build up. Once that happens we could see a shift in the market. In addition to this the rate hikes will knock some of the buyers completely out of the running totally. The market will stay strong for 2022 but home values will not continue to rise at the same rate as the last 12 months. We will have to lose a lot of buyers in this market for home values to plateau though, simply because there is no inventory. Currently there is still a surplus of buyers compared to the inventory available and as long as that stays the same the sellers market is here to stay for now.
If you have any questions or thoughts on this matter, reach out to me. I love talking about anything real estate related and to find out what others think.
Isaiah Senecal Realtor® - PSA, RENE, SRS, ARB®
I'm Isaiah Senecal, a licensed real estate professional serving St. Petersburg and the surrounding areas. My approach when helping clients is to design a customized plan for whatever your needs and wa....
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