Get ready because inventory is coming but so are more buyers. We’re having a rough weather start to the 2022 real estate market in Bergen County homes. We’ve had freezing temperatures, a major snow storm and icy conditions.
While it’s been a rough start, the activity level hasn’t slowed down. Inventory remains extremely low. It’s still around 715 homes for sale in all of Bergen County. That’s less than half of what it should be. Meanwhile buyer demand hasn’t slowed down at all.
Look at the number of homes going under contract for January. 2022 had 1,001 to 1,191 last year. That’s the effect of 2022’s even lower inventory. Rising demand with even fewer homes on the market pushed prices up 9% this January.
Basic Takeaways on Home Buyers
- A lot of us Realtors were surprised by the number of buyers coming out this early
- Interest rates really aren’t up that much – buyers understand this
- Prices will continue to go up this year – home buyers know this too
- Many more have confidence in the economy and their future
- People who delayed or made bad moves due to Covid, want their own home now
- We should see a return of the move up buyer
Let’s Look at Home Sellers
- There’s a lot of sellers who put everything on hold due to Covid
- They no longer want to put their life on hold – they want to move on
- People want normality. It’s time to move so let’s just do it.
- Home sellers have a lot of equity buildup fueling this
- Low rates benefit move up sellers as well as their home buyers
Real Estate Makes Sense
- Real estate makes sense because it’s a hedge against inflation
- Rental prices go up but your 30 year fixed rate payment doesn’t
- Cash loses value in an inflationary period while home prices go up
- All major entities like Fannie, Freddie, MBA, etc. are positive long term
- House prices have always bounced back and gained from economic downturns
- Because of this, housing is safe long term
While a lot has been said about rates rising, and they have, projections are now no more than 3.8% this year. Honestly, I was seeing it higher but not by much. It seemed to me that we’ll be at 4-4.25% at year’s end. Still not terrible at all. Consider this – when I was selling homes at 13.5% rates, prices were going up.
All the major entities see pricing up this year. It’s just a matter of degree. Who am I to argue with Fannie Mae or the Mortgage Bankers of America? 2022 is going to be another good year. So get ready because inventory is coming and it’s coming soon.