The housing market has been crazy in the last two years. The pandemic has done nothing to calm things down, and it seems to have only gotten worse. However, things might be changing in 2022, as many of the problems seem to be going away. In 2021, it was probably one of the worst years to be a homebuyer. There was almost no supply, and the few houses on the market were bought relatively quickly. There were even people who bought houses without even bothering to look at them. The trend was even worse if you were looking for homes for sale in central Florida. Florida was one of the most popular states, making it almost impossible to find a house for a reasonable price.
Supply Is Getting Better
One of the major trends for 2022 is that there will be a lot more supply in the housing market. The fact is that many of the pressures that existed in 2021 will no longer exist in 2022. There are many reasons for that, but one of the most important is that we are now building more houses. That uptick in inventory is causing more competition, driving down the prices in the market as a whole. This is great news for buyers, as they can now focus on doing their due diligence when shopping for a house.
No More Free Money from the Government
A major reason the 2021 market was so crazy was government policy. The government essentially gave away free money to anyone who wanted it. In some cases, the government paid people not to work, and it also made it possible for them not to get evicted. These policy decisions essentially meant a limitless supply of money to purchase the dwindling inventory on the market. Now that the money supply has dried up, you are no longer seeing this trend continue as it was before.
Evictions Will Drive Down Prices
As mentioned above, evictions essentially stopped during the 2021 year. This was another government policy that caused significant issues in the housing market. With people not paying rent, it meant that many landlords went under. Those landlords had to sell their property at bargain-basement prices, which also created extra supply on the market. This extra supply drove down prices, which created a feedback loop that you are now seeing today. If nothing changes, prices will drop even further in 2022. However, if you are looking for homes for sale in central Florida, you might not see that effect when shopping for property. States with a net inflow of people will still see price increases.
Supply Chain Will Continue to Improve
The supply chain was fractured during the pandemic, but it is improving slowly. As the supply chain improves, you will start seeing prices for materials go down. When that happens, we will also see more builders working on new homes. These trends will only make prices fall even more, which will help make the market better for buyers. Ultimately, these trends will affect 2022 and beyond, as there doesn’t seem to be an end in sight.