Boston Condo for Sale 2022
Some on The Street say housing correction in 2022
After two years of scorching growth in the U.S. housing market, will there be a cool-down and possibly a fall in sales and prices in 2022, along with a return to some normalcy?
Um, not exactly, several housing experts tell USA TODAY.
“Home sales are likely to be slightly lower in 2022 from the anticipated rise in mortgage rates. Home prices, meanwhile, will continue to rise due to the ongoing housing shortage even as demand is clipped a bit,” said Lawrence Yun, chief economist with the National Association of Realtors (NAR), who oversees NAR’s research group.
“After seeing such hyper-growth,” said Andreis Bergeron, head of brokerage operations at Awning.com, a real estate tech company,”I don’t think we will see a correction, maybe a slowdown.”
Ryan McLaughlin, the CEO of the Northern Virginia Association of Realtors (NVAR), also does not expect a drop in prices. “I don’t see any sort of crash in the near future. No way.”
Their comments come after one of the hottest and craziest stretches in real estate driven by a pandemic that has fueled demand for bigger houses as more Americans work from home. The frenzied buying has also been propelled by historically low mortgage rates and millennials (as many as 45 million, according to Realtor.com) trying to purchase their first house.
Last year the median price of an existing single-family home jumped to an all-time high of $357,900, up 23% from a year earlier, according to the NAR. About 94% of 183 metropolitan areas that were measured notched double-digit gains, up from 89% from the previous year, the organization said.
►A virtual real estate boom: How the metaverse could reshape the real estate landscape both virtually and in reality
►Housing tips during COVID: Three families bought and sold their homes during the pandemic’s red-hot market. Here’s what they learned.
As for home sales this year, the market will remain strong, experts say, but resemble closer-to-normal levels. The NAR forecast calls for median price gains by the end of 2022 of between 5% and 7%. But buyers will also have to contend with rising inflation that could raise prices higher as well as slightly higher interest rates.
Mortgage rates will go up this year after hitting historical lows during the pandemic, but not by much, Yun said. The NAR thinks it will be around 3.7%, compared to 3.4% currently. That’s still historically low.
Although there might be a home sales drop of about 2% in 2022, Yun still predicts sales will outdo pre-pandemic levels. The NAR anticipates that annual median home prices will increase by 5.7% in 2022.
Yun also believes there are still between 5.5 to 6.8 million housing units that would need to be built to meet the market demand for homes.
►Changing landscape: After a year of bidding wars and record-high prices, here’s what’s changing for homebuyers in 2022
That could mean regions like the South will continue to be a hotbed for homeownership due to more supply, said Robert Dietz, a chief economist with the National Association of Home Builders (NAHB).
He said the region, including Texas hotspots Austin, Dallas-Forth Worth and Houston, will continue to represent more than half of all new single-family homes built in the U.S,
That coincides with the NAR identifying 10 housing markets as “hidden gems” to look out for this year. Besides Dallas-Fort Worth, those other metro areas include Daphne-Fairhope-Farley, and Huntsville, Ala.; Fayetteville-Springdale-Rogers on the Arkansas-Missouri border; Knoxville, Tenn.; Palm Bay-Melbourne-Titusville, and Pensacola-Ferry Pass-Brent, Fla.; San Antonio-New Braunfels, Texas; Spartanburg, S.C.; and Tucson, Ariz.
“There’s a cause-and-effect occurring because those markets are attracting businesses and it’s easier to develop commercial properties and new homes,” said Dietz, citing Tesla CEO Elon Musk’s recent announcement to move his company headquarters from the San Francisco Bay area to Austin.
McLaughlin cites a similar situation created by Amazon’s soon-to-be newest headquarters in Arlington, VA., which will attract new homeowners in a market where the average price of homes sold in NVAR’s region peaked near $750,000 in October. He said in November the sales volume in his region was more than $17 billion, 25% higher than the 2020 sales volume at that time.
Boston Real Estate and Condos for Sale
Some on The Street say housing correction is not a bubble bursting
The question of whether the downtown Boston real estate market is a bubble ready to pop seems to be dominating a lot of conversations – and everyone has an opinion. Yet, when it comes down to it, the opinions that carry the most weight are the ones based on experience and expertise.
Here are four expert opinions from professionals and organizations that have devoted their careers to giving great advice to the national housing industry.
The Joint Center for Housing Studies in their The State of the Nation’s Housing 2021 report:
“… conditions today are quite different than in the early 2000s, particularly in terms of credit availability. The current climb in house prices instead reflects strong demand amid tight supply, helped along by record-low interest rates.”
Nathaniel Karp, Chief U.S. Economist at BBVA:
“The housing market is in line with fundamentals as interest rates are attractive and incomes are high due to fiscal stimulus, making debt servicing relatively affordable and allowing buyers to qualify for larger mortgages. Underwriting standards are still strong, so there is little risk of a bubble developing.”
Bill McBride of Calculated Risk:
“It’s not clear at all to me that things are going to slow down significantly in the near future. In 2005, I had a strong sense that the hot market would turn and that, when it turned, things would get very ugly. Today, I don’t have that sense at all, because all of the fundamentals are there. Demand will be high for a while, because Millennials need houses. Prices will keep rising for a while, because inventory is so low.”
Mark Fleming, Chief Economist at First American:
“Looking back at the bubble years, house prices exceeded house-buying power in 2006 nationally, but today house-buying power is nearly twice as high as the median sale price nationally…
Many find it hard to believe, but housing is actually undervalued in most markets and the gap between house-buying power and sale prices indicates there’s room for further house price growth in the months to come.”
Downtown Boston Condos and the Bottom Line
All four strongly believe that we’re not in a bubble and won’t see crashing home values as we did in 2008. And they’re not alone – Goldman Sachs, JP Morgan, Morgan Stanley, and Merrill Lynch share the same opinion.
Boston Real Estate and Condos for Sale
Ford Realty Inc., Charles Street, Beacon Hill
Click Here to view: Google Ford Realty Inc Reviews
_______________________________________________________________________________________________________________________________________________________________________________________________________
While a number of sales have dropped in a lot of markets (perhaps 25%, year-to-year, in Massachusetts and in Boston), prices have not, in many. Yet. (Some economists predict lower prices in Las Vegas and parts of Florida, due to overbuilding.)
What’s going on?
New mortgage applications are up. Pending home sales are up. The economy is expanding. Unemployment is at 4.6 percent. And mortgage rates are still historically low …
All the dismal reports about the real estate market overlook the realities in the marketplace, some housing experts say.
Today’s “unusually low” long-term mortgage-rate environment “stands in sharp contrast to some past downturns in the housing market that followed actions by the Federal Reserve to tighten credit conditions significantly,” Kohn adds …
Perhaps the most blunt appraisal comes from Mike Moran, chief economist of Wall Street’s Daiwa Securities America. Moran says the financial press is taking a normal and long-predicted cyclical rebalancing and “portraying it as a catastrophe.�
Complete story: Economists Say Housing Downturn Isn’t So Bad – By Kenneth R. Harney, Washington Post Writers Group, by way of Realtor.org
Back to Boston condos for sale homepage
Contact me to find out more about this property or to set up an appointment to see it.
Back to the homepage: Boston condos
SEARCH FOR BOSTON CONDOS FOR SALE
For more information please contact one of our on-call agents at 617-595-3712.
Updated: Boston real estate 2021
