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Americans have been on a housing buying spree over the past two years, but there are signs the hot seller’s market is cooling off. Real estate data from April and May 2022 shows new home sales falling by 19%. Existing home sales are also declining.
While the summer 2022 homebuying season is still expected to be dominated by a strong seller’s market, it will be cooler than what we’ve seen in recent years. Home prices will likely still rise, but at a slower pace and sellers can expect fewer bidding wars over their houses.
This doesn’t mean buyers will necessarily have the upper hand in negotiations and deals will still be very few and far between, but with less competition for homes in some markets, buyers may have more time to view homes and craft strategic offers.
If you’re planning on buying or selling a home during the upcoming summer season, you’ll want to stay up to date on what’s going on in the market. In this blog post, two of SWBC Mortgage’s top professionals weigh in on what to expect in the coming months.
Marcia Messer (NMLS 222428) is a Loan Officer with SWBC Mortgage. She works tirelessly to help her clients achieve their goal of home ownership and is committed to making the experience positive and memorable. Here’s her advice for the coming months:
Use a real estate agent. As a buyer, you don’t pay the realtor commission so it’s always in your best interest to use one so you are represented in the best way possible and they will work hard to cover all your bases. Make sure your credit score is as high as it can be, get preapproved for your loan, and make sure that your credit score is getting you the best rate possible.
As a Senior Loan Officer with SWBC Mortgage with more than 14 years of experience in the mortgage industry, Matt Tenney (NMLS 943242) has helped many families achieve the dream of homeownership. Here’s his advice for homebuyers and sellers in 2022:
It’s amazing how the market continues to evolve. For buyers, despite the continued increase in home values and higher mortgage rates, the outlook for buying a home is brighter. In many markets across the country buying still makes more financial sense than renting, especially over the long haul.
While sellers continue to be in control, buyers have more leverage currently than they’ve had in a while. Inventory is still low so don’t expect to find that crazy “deal” out there. Sellers can continue to command high prices for their homes.
While buyers may not have to waive all contingencies and submit an offer well over the asking price, it continues to be important to craft a competitive offer. Being non-contingent on the sale of a current home will still make your offer stand out in the eyes of a seller as well as being flexible and adhering to their timing preferences. If you as a buyer have been holding off, this could present a great opportunity to jump back in and find a home while your competition sits on the sidelines.
For sellers, this is simply a time to hit the reset button on your expectations. Yes, your neighbor may have received multiple above-asking offers and got under contract in a day only a few months ago but now that is happening less frequently. It’s important to talk with your realtor about what the expectations should be as many buyers have paused their home search due to skyrocketing mortgage rates and higher home values.
However, despite more inventory coming on, demand still far outstrips the supply so appreciation and high home values can still be had. A recent conversation with a realtor in the Denver area advised that first impressions are very important now. She recommended her sellers make sure their home is in great shape and has nice curb appeal before going on the market. She also advised that pricing the home correctly upfront is more important now.
If an open house is not receiving any traffic or if the home is receiving well below asking offers or no offers, it could be an indication that the sale price is listed too high. If homes are in a desirable neighborhood, are in great shape, and are priced correctly they are still going under contract very quickly.
If you're feeling stressed out over the homebuying process this summer, then take a deep breath! Remember, you're making an exciting investment for your future and your family, and all of the hassle will soon pay off.
SWBC Mortgage Corporation, NMLS #9741, check licensing at www.nmlsconsumeraccess.org. AZ BK #0950067; Licensed by the Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act #4130449; Licensed by the N.J. Dept. of Banking and Insurance. Loans subject to credit and property approval, restrictions and conditions may apply. Not all loan programs or loan amounts available in all areas. Programs and guidelines subject to change without notice. Corporate office: 9311 San Pedro Ave., Ste. 100, San Antonio, TX 78216. © 2021 SWBC. All rights reserved.
A graduate of the Plan II Honors program at UT Austin, Amanda Harr is the Content Manager for SWBC. A clever wordsmith who appreciates artful persuasion and authenticity in writing, Amanda uses a structured creative process to craft marketing strategies, develop communications solutions, and deliver top-notch content.