Real Estate Trends To Watch Out For In 2022


There are several housing trends occurring in the market which leads us to the question of what will happen in the industry in 2022? Will the pandemic continue to bring low-interest rates or will the markets be on fire? Each industry has dominating trends and the real estate industry is no different. There are real estate agents, brokers, experts, and home buyers and sellers who are keen to know more about the trends in 2022. Here are some of the top trends you must watch out for.

Industrial properties will be high in demand

The demand for industrial properties will continue to grow this year. With e-commerce taking the front seat and gaining high popularity with consumers, there is a surge in the demand for industrial properties like warehouses that help store the items that retailers sell. All e-commerce businesses will need some place to store the inventory to ensure quick shipping. Hence, the demand for industrial space and warehouses by e-commerce businesses will continue to grow this year and beyond. It will lead to more businesses occupying these spaces.

The market will be affected by climate issues

Climate issues affect each one of us and it will also impact some markets. Tornadoes, wildfires, and scorching heat will have an impact on the market and there is a solid chance that these weather conditions and disaster patterns will continue in 2022. Such issues will have an impact on the desirability and price of properties in certain areas. Beach-facing communities have always demanded a premium from buyers but in several areas, the rise in average temperatures has caused the homes to be at the risk of flooding and it makes the homes in such areas hard to sell. It has already happened in some parts of the country.

Rents will be on the upward trajectory

Renting a property will not be easy this year. The rent prices are already soaring due to the pandemic and it is likely to continue this year. There are not enough rental units available in the market to meet the growing demand and when there is more demand than supply, the rent will increase. Builders are trying their best to meet the need but it will take time. Rental units cannot go up as fast to meet the demand. Then there are other issues like supply chain issues and the cost of construction materials which make it hard to meet the demand. For renters, this means a lot more money going toward rent and less leftover for all the other expenses.

Mortgage rates will rise

The mortgage rates have remained low in the past year but they are expected to rise this year. There could be a marginal increase in the interest rates by the Federal Reserve and this will make borrowing expensive. Even a marginal increase can lead to a huge outflow in interest on the loan and could become tough for the lower to moderate-income buyers to afford the purchase. However, if you already own a home and are above the age of 62, you can take the benefit of a reverse mortgage and make the most of the value of your home. Understand the different reverse-mortgage pros and cons before you proceed.

Home value appreciation will slow

The appreciation in home value will slow down especially in markets that are hot across the country. It may change in the coming years but do not expect the home value to be appreciated at a rate as it did in the past two years. The appreciation rate was as high as 20% in the middle of 2021 but it could be lower than 10% this year. What this means is that the home you buy will not skyrocket in value as it would have done in the past. Its value will grow but it will be at a more manageable pace, making it easier for small budget buyers to own homes.

Cash deals will dominate

Cash deals have become a huge part of the industry in 2021 and it will continue this year as well. The push for property investments is not slowing down and this means there will be more people willing to pay hard cash for homes. This means unlike the regular home buyers with mortgage loans, cash buyers will not need to meet the financing requirements and it could push some real estate professionals out of the business. The cash deals trend will continue to make the market competitive and give a tough time to those who do not have enough cash on hand.

These are some of the top real estate trends to watch out for in 2022. They could have a huge impact on the decisions made by home buyers.