It’s That Time of Year — Predictions Are In!
As we move into 2022, both buyers and sellers are wondering, what’s next for real estate in Montecito, Santa Barbara and nationwide? Will the inventory of houses increase? Will appreciation and prices continue to rise? What will happen to interest rates? For the answer to those questions and more, we turn to the experts from a recent article in Keeping Current Matters. Here’s a look at what they say we can expect in 2022. What will happen to interest rates? “Consensus forecasts put rates at about 3.7% by the end of next year. So, that’s still historically low, but certainly higher than they are today.” - Odeta Kushi, Deputy Chief Economist, First American Will appreciation and prices continue to rise? “Affordability will increasingly be a challenge as interest rates and prices rise, but remote work may expand search areas and enable younger buyers to find their first homes sooner than they might have otherwise. And with more than 45 million millennials within the prime first-time buying ages of 26-35 heading into 2022, we expect the market to remain competitive.” - Danielle Hale, Chief Economist, Realtor.com Will the inventory of houses increase? “With more housing inventory to hit the market, the intense multiple offers will start to ease. Home prices will continue to rise but at a slower pace.” - Lawrence Yun, Chief Economist, National Association of Realtors (NAR) “We also expect a growing number of homeowners to bring properties to market, taking some pressure off high prices and offering buyers more options.” - George Ratiu, Manager of Economic Research, Realtor.com What Does This Mean for Buyers? Hope is on the horizon for 2022. You should see your options grow as more homes are listed and some of the peak intensity of buyer competition starts to ease. Just remember, rising rates and prices are a great motivator for you to find the home of your dreams sooner rather than later so you can buy while today’s affordability is still in your favor. What Does This Mean for Sellers? Make no mistake – this sellers’ market will remain in 2022 as home prices are projected to continue climbing, just at a more moderate pace. Selling your house while buyer demand is so high will truly put you in the driver’s seat. Bottom Line Only time will tell what 2022 will bring for the real estate market, but hopefully the above gives you some insight on what may be on the horizon for Montecito, Santa Barbara and nationwide.