Experts Predict the Best Times To Buy and Sell Homes in 2022
You’ve been keeping tabs on the real estate market frenzy since 2020, and you’re finally about to jump in. Whether you’re planning to sell your home, buy a new one or both, you want to quite literally make a big move 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 impact both the sale price of a home and, in a competitive market, your chances of submitting the winning bid.
Caleb Spears, a luxury real estate agent with Spears Group, based in Santa Rosa Beach, Florida, said while they have different implications for both, buyers and sellers should actually be looking for the same signals in 2022 — days on market and interest rates.
“Days on market tends to be a lead measure for pricing, and the two are inversely related,” he said. “What this means is that historically as DOM goes up, prices then come down and vice versa.”
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The way you want this to trend will depend on which category you fit into — i.e., buyer or seller.
“For sellers, a rising number of days on market should be a trigger for you to sell while the prices are still peaking,” he said. “For buyers, if you see a trend of rising days on market across an area, then be patient.”
When it comes to interest rates, Spears said the current record lows are wonderful but unsustainable and likely to rise sometime in 2022.
“For sellers, this means that your buyer pool will begin to shrink and there will be less demand in the market once interest rates begin to climb,” he said. “This should lead to lower overall prices due to less negotiating power for sellers and a higher supply.”
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Despite that, he said buyers shouldn’t celebrate too quickly, as this mainly benefits cash buyers.
“If you finance your loan, then your mortgage may end up at a higher monthly payment on a lower priced home,” he said. “This is a major factor in why many people are willing to buy a record priced home at a low interest rate.”
As for timing, Allan Prigal, a real estate agent in Gaithersburg, Maryland, said he believes the best time to buy or sell in 2022 will be the first quarter of the year.
“All indications are that mortgage interest rates will go up somewhat as the year goes on, with many saying the 30-year fixed rate may be as high as 3.6% in the 4th quarter of 2022 — [which is] still extremely low,” he said.
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He said this will give buyers the ability to afford more house.
“Usually, inventory is pretty low the first two months of the year and starts to increase as spring nears,” he said. “I believe that sellers in the first quarter of the year will have the best of both worlds, with low inventory and low interest rates, thereby making the first quarter of the year the optimum time to sell.”
Ultimately, Prigal said there will still be a housing shortage overall, but not as frenetic of a pace as 2021. Therefore, he thinks this should create good opportunities for both buyers and sellers.
Nancy Berger, a real estate agent in Saint Paul, Minnesota, said she believes sellers will still have an upper hand in 2022, but rising interest rates will create a more balanced market.
“The bidding wars will calm and common sense will return,” she said. “Expect in certain areas and price ranges that demand will outpace supply.”
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She said both buyers and sellers should be watching the market now.
“As an industry, we know spring market is the busiest and most robust of the year,” she said. “Expect homes to start hitting the market in late January and early February.”
For sellers, Berger said you’ll have to decide if you want to be listing with many comparable properties or one of the first on the 2022 market. She recommended working with your realtor to decide what makes the most sense for your unique situation.
Chuck Vander Stelt, a real estate agent in Valparaiso, Indiana, echoed the sentiment that the typical best times of year to buy or sell a home will be in place for 2022.
“Late winter through mid-summer is typically the best time of year to sell a home,” said Vander Stelt, who is also the founder of the real estate site Quadwalls.com. “This is because the active homebuyer audience is at its highest level.”
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Since interest rates will likely rise in 2022, he said sellers wanting to get the highest price for their homes should act quickly.
“Savvy 2022 home sellers should beat their competition by trying to be the first listing to bloom in late winter or early spring 2022,” he said.
Conversely, he said buyers searching for the best deal should delay their purchase until the fourth quarter of the year.
“The audience of homebuyers shrinks to its smallest size late in the year,” he said. “Real estate markets get downright ice cold from about two weeks before Thanksgiving until Christmas.”
Ultimately, whether you’re a buyer or seller, he said the biggest mistake you can make is acting when the market is too busy.
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This article originally appeared on GOBankingRates.com: Experts Predict the Best Times To Buy and Sell Homes in 2022
