2022 Home Ownership Forecast
As the end of 2021 is near, the homeownership forecast for 2022 is not exactly certain. The Covid-19 pandemic is still affecting the housing market to this day, so as we enter the new year, there will surely be more obstacles to face.
Since the start of the pandemic, we’ve seen eviction moratoriums, increased demand for homes, significant increases in home prices, and more unforeseen obstacles. Although it’s predicted that the rise in home prices is set to slow down, it’s possible that we may see a rise in mortgage prices as a result, according to Doug Duncan, chief economist at Fannie Mae. As of 2021, we’ve witnessed record-low mortgage rates, so the possibility of rates increasing is likely. However, while prices are still low, it may be a good time to invest before rates potentially increase in the new year.
If you’ve been following the housing market this year and are curious about the forecast for the new year, just keep reading! We will go over some of the rental property investment trends to look for in 2022, such as:
- Increased demand for homes
- Low mortgage rates but high rent
- Reduced home construction
- A seller’s market
Increased Demand for Homes
In 2021, we’ve seen an enormous increase in demand for homes. When the pandemic started, we saw a significant decline in the housing market. However, in 2021 we’ve seen a massive increase in home buying—and it’s not slowing down now.
Part of the reason for the increased demand is the ease of working from home, which was widely discovered during the pandemic. People were advised to stay home from work or continue working from home, which some companies have found to work smoothly. Because of this ease, people realize that they don’t necessarily have to live in the city in which they work. It also sheds light on the price difference between city homes and suburban homes, which is another factor to consider when looking at the 2022 homeownership forecast.
Low Mortgage Rates but High Rent
Along with the increased demand for homes, we are experiencing a period of extremely low mortgage rates. These low mortgage rates contribute to the high pricing of homes, especially when it comes to rental properties.
We’ve experienced a climb in rental rates within the past year as landlords are trying to stay afloat during the pandemic. It’s unclear how long the rental industry will struggle with government policies and Covid-19 restrictions, but time will tell as we roll into the new year.
Reduced Home Construction
Before the pandemic even started, the United States was experiencing a housing shortage. As you can imagine, the pandemic did not make it any better. Home construction slowed down for months due to stay-at-home orders and construction material shortages. Like the rest of the world, the home construction industry came to a halt, and many people had job changes.
Unfortunately, there are still construction shortages today, which will affect the housing market as we enter 2022. Because of this, we will continue to see a great demand for homes, while home prices may increase.
A Seller’s Market
Since the demand is so high and the supply of homes is relatively low, it’s still a seller’s market as of 2021. However, with so many people looking to buy homes, prices are set at higher rates, allowing investors to make significant profits.
As we enter 2022, the supply and demand of homes may change a bit, but it doesn’t look like it’s slowing down too dramatically. Perhaps if you’re looking to sell your home for a profit, now may be the time.
Keeping up with housing market trends is helpful, even if you are not looking to purchase a home at this time. Scoping out these trends can help you make a wise investment decision in the future. Keep up with the supply and demand, mortgage rates, and homeownership forecast for when you are looking to purchase.