As pandemic restrictions ease here and abroad, conflicts elsewhere in the world have posed both challenges and opportunities in the way we live our lives. So, what does all this mean for the US real estate market in 2022, particularly when it comes to Winthrop, WA real estate?
The demand for real estate will soften in the short term
Rising mortgage rates will serve to cool down the red-hot real estate market, one of the drivers of inflation. As rates rise, potential buyers will start to rethink whether they can afford the increase in monthly mortgage payments.
With buyers opting out of the market for the time being, competition will ease and result in a drop in house prices. The decline in demand may be negligible at first as the market contends with the bottleneck of would-be buyers still eager for a chance to snap up a home.
What this means for you. If you were on the fence about buying, it won’t hurt to check your listings again. Better yet, consult your real estate agent. They may be able to recommend newly listed homes, uncover an overlooked property that’s right for you, or negotiate a good price on a house you like.
How 2021 trends shaped the current market
Let’s look at the real estate market trends in 2021 so we can understand what to expect for the rest of 2022.
- Low mortgage rates and limited supply. This resulted in a price surge in mid-2021, with only 1.38 homes listed for sale in June, 23% less than 2020, according to Redfin.
- Moving to less expensive areas. Working from home led homebuyers to move to more affordable locations in the US, such as rural towns. The economic growth that followed the 2020 recession gave the affluent more power to buy second homes, making for a very competitive real estate market.
- Buyers willing to pay more. In 2021, the National Association of Realtors’ annual profile of homebuyers and sellers showed that a third of buyers for the year paid above the asking price.
- Winthrop real estate in 2021. Over the last 12 months, the prices of Winthrop homes for sale increased 11 times and decreased only once. Median home values increased by 5.431% between April 30, 2021 and April 30, 2022.
Looking ahead to the rest of 2022
Based on previous trends and expert insights, here’s what we can expect of the real estate market for the rest of this year.
- Increased prices. According to the National Association of Realtors’ economic and housing experts survey, median home prices will increase by 5.7% this year, with consistent housing availability to accommodate more buyers in the market.
- Higher interest rates. While we saw low mortgage and interest rates in the past two years, projections this year show the 30-year fixed mortgage at 3.75%, higher than the average rate of 2.79% last year, according to Bankrate.
- More demand in smaller markets. With people leaving big cities to move to quieter or more exclusive locations, housing prices will continue to increase in these areas, making nearby markets more attractive. Experts see new homeowners buying second homes in downtown areas or nearby suburbs.
- Winthrop real estate in 2022. According to Walletivestor’s Winthrop real estate market research, home values will increase in the next 12 months, with values predicted to increase by 51.168% in the next 10 years.
With home values increasing in the Winthrop real estate market and all over the country, now might be the best time to find your next profitable investment. Get in touch with experienced Winthrop realtors here at Coldwell Banker Winthrop. Call us at 509.996.2121 or send us an email at info(at)cbwinthrop(dotted)com.