CONGRATULATIONS and WELCOME TO THE 2ND HALF OF THE YEAR! Glad you could make it, then again with a brilliant Realtor such as yourself it’s no surprise.
The first half of the year has certainly been interesting from a housing market perspective. Mortgage rates surprised everyone by rising sharply, while housing inventory largely remained stagnant.
This caused a significant shift in demand towards the end of the quarter, which led to a dramatic increase in homes sales over that week. In addition, supply issues continued to plague many markets across the country, causing home prices to again outpace median household income in most major metros. While these trends are expected to continue into the second quarter of 2019, it is also important to note that many markets have already begun surpassing their previous peaks from 2000-2018.
The housing market follows a predictable seasonal cycle and can be broken down into different phases, depending on where you are in the country. It's important for homebuyers and real estate investors alike to understand what to expect from the market during each of these phases.
Here are the top 3 real estate predictions for the second half of the year:
1. MORTGAGE RATES TO REMAIN HIGH, BUT INCREASES SHOULD TAPER OFF
Most homeowners don't expect their mortgage rates to climb higher — but they are. Rates have risen substantially since the start of the year, largely due to the Federal Reserve's rate hikes, which began in 2019 and show no signs of ending anytime soon. As consumers prepare to shop for homes, it's a good time to be aware that the Fed is expected to continue raising rates throughout the year.
2. HOUSING INVENTORY WILL INCREASE, BUT ONLY A LITTLE
NAR's most recent data shows that inventory levels have climbed slightly, but they're still nowhere near the "equalized" four-to-six-month range. And sellers are becoming more comfortable with putting homes on the market and accepting offers. Sellers have been reluctant to list their homes as quickly as usual since the pandemic. That's because a lot of people are selling for less than usual because of the uncertainty surrounding whether their houses will be bought in an open market—putting bad deals above good ones
Homebuyers, beware. It's springtime, which means the market should be flooded with homes. But so far, there are few signs that builders and sellers are entering the homebuying frenzy we're accustomed to.
3. HOME PRICES TO REMAIN HIGH
Home prices are expected to remain elevated in 2022 and could continue to rise as the year progresses. There are likely to be fewer homes for sale during the latter part of the year, which could make it even harder for some buyers to get into the market. First-time buyers should keep the lower mortgage rates in mind before writing off home ownership altogether.
How do you think your business will be affected by these trends? Let us know in the comment section below!
About the writer: Shaura Cuyan writes all the hottest Real Estate trends and predictions for Summit VA Solutions! She has previously written for a number of freelancing gigs both locally and internationally and writes her own blog on lifestyle and current issues. She is a Graduate of Bachelor of Arts in Communication and has a Masters degree in Development Communication.