What can sellers expect in 2022?
As forecasted for 2022, the seller market is slowing down. That doesn’t necessarily mean immediate relief for buyers though. Inflation will have its residual effects, and that’s coupled with the federal reserves’ announcement of rate hikes in the early spring. This has many industry experts agreeing that home prices will not begin to decline anytime in the near future. That is, until specific market conditions are met. So, things like inventory catching up to demand and material being more readily available at reasonable prices, are going to be pertinent precursors and key indicators before buyers can expect to see some kind of relief from escalated home values.
So how does this effect the seller? That’s the question. It means sellers need to be more grounded and make their pricing decisions based off normal, sound real estate principle. The ability to speculate larger gains and over price homes is over. How do I know this? I’ve witnessed it firsthand, and I also keep a very close eye on NAR statistics. Overpriced homes are tending to sit on the market and we’re witnessing a higher frequency of expired listings. Regular priced homes are not going multiple offer as frequently, and if they are, we’re only competing with 3 or 4 offers not 18-24 as the same time last year. In the last 2 weeks I’ve secured 2 contracts for clients with sellers contributing to buyer closing cost, that’s something the market wasn’t allowing 18 months ago. We’re also seeing more and more VA offers getting accepted. The significance of that, is that VA financing is federally backed and has a higher standard for the homes condition and a tendency to appraiser lower than the traditional loan, causing issues right before closing.
If you have any questions or would like further explanation on these concepts, please don’t hesitate to reach out at 915-525-7556. Please also take the time to visit the article below which explores some of the other factors impacting home values this year.
Aurthor: Isaac J. Olmos |Resale Listing Specialist | Certified Probate Real Estate Specialist | Olmos Real Estate Group