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Starting in 2020, the real estate market is going crazy, and you’re finally going to get in. Whether you’re thinking of selling your home, buying a new one, or both, you’ll want to literally do it big. Moving in 2022.
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Of course, timing is everything in life and real estate, so you want to make sure you get it right. This is important because it can affect both the home’s sale price and your chances of making the winning bid in a competitive market.
While they have different implications for both, buyers and sellers should really look for the same signs in 2022 — dates on the market and interest rates, says Caleb Spears, luxury real estate agent of the Spears Group in Santa Rosa Beach, Florida.
“Days on market becomes the leading measure of pricing, and the two are inversely related,” he said. “This means that historically, as DOM increases, prices decrease and vice versa.”
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The way you want this trend to play out depends on which category you fit into – that is, a buyer or a seller.
“For sellers, an increase in the number of days on market should be a trigger to sell when prices are rising,” he said. “For buyers, if you see an upward trend in the local market, be patient.”
When it comes to interest rates, Spears says the current record lows are impressive but unsustainable and could peak sometime in 2022.
“For sellers, this means that your buyer pool will start to shrink and there will be less demand in the market once interest rates start to rise,” he said. “This should lower overall prices due to less bargaining power for sellers and higher supply.”
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However, he said that buyers should not comply too soon as money mainly benefits the buyers.
“If you’re subsidizing your loan, then your mortgage could end up with a higher monthly payment on a lower-priced home,” he said. “That’s the main reason why so many people are willing to buy a home at record low interest rates.”
When it comes to timing, Gaithersburg, Maryland real estate agent Allen Pregal believes the best time to buy or sell in 2022 is the first quarter of the year.
All indicators show that mortgage interest rates will increase somewhat as the year progresses, with many predicting that the 30-year fixed rate could reach as high as 3.6% in the 4th quarter of 2022. [which is] It is still extremely low,” he said.
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This will allow buyers to buy more houses, he said.
“Usually in the first two months of the year, stocks are very low and start to increase as spring approaches,” he said. “I believe sellers will get the best of both worlds in the first quarter of the year, with low inventories and low interest rates, making the first quarter of the year an ideal time to sell.”
Finally, Prigal stated that there will be a general lack of housing, but not as fast as in 2021. Therefore, he thinks that this should create good opportunities for both the buyer and the seller.
Nancy Berger, a real estate agent in St. Paul, Minnesota, says sellers will still dominate in 2022, but rising interest rates will create a more balanced market.
“The bidding wars will calm down and common sense will return,” she said. In some areas and price ranges, demand exceeds supply.
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Now both buyer and seller have to monitor the market, she said.
“As an industry, we know the spring market is the busiest and strongest of the year,” she said. Expect homes to start hitting the market in late January and early February.
For sellers, Berger says you’ll need to decide whether you want to list among several affordable properties or among the first ones on the market in 2022. She suggests working with your realtor to determine what’s best for your unique situation.
Chuck Vander Stelt, a real estate agent in Valparaiso, Indiana, echoes the idea that 2022 is the best time of year to buy or sell a home.
“Late winter to mid-summer is typically the best time of year to sell a home,” says Vander Stelt, founder of the real estate website Quadwalls.com. “That’s because the active homebuyer audience is at its peak.”
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With interest rates likely to rise in 2022, sellers looking to get the best value for their homes should act quickly, he said.
“Savvy 2022 home sellers will have to beat the competition by trying to be the first to list to spring in late winter or early spring 2022,” he said.
On the other hand, buyers looking for the best deals should delay their purchases until the fourth quarter, he said.
“The audience of home buyers will shrink to a smaller size by the end of the year,” he said. “Real estate markets freeze in the two weeks before Thanksgiving until Christmas.”
Ultimately, he said, the biggest mistake you can make, whether you’re a buyer or a seller, is when the market is crowded.
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