I’ve worked in real estate long enough to witness some familiar time frames repeat themselves. While there is no crystal ball in real estate, there is almost an unrivaled certainty that market predictions will start rolling in for the new year before the leaves even start to turn. With fall well underway, many of the major industry organizations and media outlets are making their predictions for what real estate will look and feel like in 2022. Below is a sampling of what the experts expect (click titles to read in full):
CALIFORNIA ASSOCIATION OF REALTORS (CAR)®
C.A.R. Releases Its 2022 California Housing Market Forecast
Highlights: “California housing market to remain solid if pandemic is kept under control, but structural challenges will persist. Existing, single-family home sales are forecast to total 416,800 units in 2022, a decline of 5.2 percent from 2021’s projected pace of 439,800. California’s median home price is forecast to rise 5.2 percent to $834,400 in 2022, following a projected 20.3 percent increase to $793,100 in 2021. Housing affordability is expected to drop to 23 percent next year from a projected 26 percent in 2021.”
_ _ _
FORBES
11 Predictions For The Future Of The Real Estate Market
Highlights: The Forbes Real Estate Council believes that “there will be less urgency to buy real estate… The exodus from metropolitan areas should subside and second home markets are likely to experience a softening. Real estate is expected to “appreciate at an above-average rate through late 2021 for three reasons – scarcity, utility and demand.” The large influx of sales last year is likely to lead to “fewer showings, fewer offers and less aggressive offers” since those who bought last year are unlikely to buy again this year. Other big picture themes include a more balanced market, an increase in the use of technology to drive the value of assets and a growing rental market.
_ _ _
Business Insider
The Treacherous Housing Market Will Continue Through 2022 As Prices Surge Further, Goldman Says
Highlights: “The good news: Prices won't surge as much next year as they have in 2021. The bad news: They're still going to go up a lot. The mismatch between buyer demand and nationwide supply is the basis for the bank's expectation that prices will boom well into the 2020s. The bank expects that price surge to continue through 2022. Goldman sees shelter inflation rising to a year-over-year rate of 4.5% by the end of next year, a sharp acceleration from the current 2.4% pace and the fastest price growth in 20 years.”
_ _ _
Please keep in mind that while these are data-based projections, there is no way that anyone can truly ‘see’ the future of real estate. In addition, the market trends that dominate the national and state headlines as a whole will play out very distinctly here in Silicon Valley – and this is where we can help you weigh your own best options.
We will keep you posted as more projections roll in, and encourage you to base your own real estate goals on your needs and lifestyle hopes today with a moderate pulse on the educated guesses of tomorrow. In short, don’t let analysis paralysis stop you – but do allow information to empower you!
All my best,
Mark