Expert Housing Market Forecasts for the Second Half of the Year
The housing market is at a turning point, and if you’re thinking of buying or selling a home, that may leave you wondering:
Is It Still a Good Time to Buy a Home? Should I Make a Move This Year?
To help answer those questions, let’s turn to the experts for projections on what the second half of the year holds for residential real estate.
Where Mortgage Rates Will Go Depends on Inflation
While one of the big questions on all buyers’ minds is where mortgage rates will go in the months ahead, no one has a crystal ball to know exactly what’ll happen in the future. What housing market experts do know is that the record-low mortgage rates during the pandemic were an outlier, not the norm.
This year, rates have climbed over 2% due to the Federal Reserve’s response to rising inflation. If inflation continues to rise, it’s likely mortgage rates will respond.
Greg McBride, Chief Financial Analyst at Bankrate, explains:
“Until inflation peaks, mortgage rates won’t either. Without improvement on the inflation front, we don’t know where the interest rate ceiling will be.”
Whether you’re buying your first home or selling your current house to make a move, today’s mortgage rate is an important factor to consider. When rates rise, they impact affordability and your purchasing power. That’s why it’s crucial to work with a team of professionals so you can make an informed decision.
The Supply of Homes for Sale Projected To Continue Increasing
This year, particularly this spring, the number of homes for sale has grown. That’s partly due to more homeowners listing their houses, and also because higher mortgage rates have helped ease buyer demand.
Moderating buyer demand slows the pace of home sales, which in turn helps inventory rise. Experts say that growth will continue.
Recently, realtor.com updated their 2022 inventory forecast. They increased their projection from a 0.3% increase at the beginning of the year to a 15.0% jump by year-end.
More homes to choose from is great news if you’re craving options, but there still isn’t a surplus. Inventory remains low, so working with an agent will help you act quickly when the right home hits the market.
Home Price Forecasts Call for Ongoing Appreciation
Due to the imbalance between homes for sale and buyers in the market, the pandemic led to record-breaking home price increases. According to CoreLogic, homes appreciated by , and they’ve continued rising this year.
Even though supply is increasing, there are still more buyers than homes available, which continues to put upward pressure on home prices.
Experts are forecasting continued appreciation, but at a more moderate pace — an average of 8.5% in 2022.
Selma Hepp, Deputy Chief Economist at CoreLogic, notes:
“The current home price growth rate is unsustainable, and higher mortgage rates coupled with more inventory will lead to slower home price growth but unlikely declines in home prices.”
So, if you’re thinking about selling or buying, know that prices are still rising. Acting sooner could mean securing a better deal than waiting.
Bottom Line
Whether you’re a homebuyer or seller, it’s essential to stay informed about what’s happening in the housing market. Let’s connect to talk through your goals and build the best plan for your move.
