Where will the real estate market be in 2022? No one can predict the future, but with that being said, there are still plenty of things we can do to better plan for what we might face in 5 years, especially if you’re someone who sells homes for a living or if you’re someone who plans on selling their home in the future. Here are some trends in real estate that are both promising and ominous, and why they could make or break the year 2022, both good and bad.
Housing market
Increasingly, Americans are giving up on homeownership. According to a 2018 report from U.S. PIRG, today’s younger generation is less likely to own a home than their parents were at that age—the first time that’s happened in 40 years. As some young people decide it’s too expensive or too much of a hassle to buy a house, they’ll likely turn to renting, creating opportunities for new players in local markets and allowing existing landlords to raise rents on apartments already in their portfolio. This will drive major changes in real estate markets across America in 2022.
Renting vs buying
Pros and cons of renting vs buying real estate. Before deciding if you should rent or buy, it’s important to consider some of your short-term and long-term goals as well as your financial situation. In some cases, buying can make sense even if you don’t plan on staying in a home indefinitely—and in others, renting is actually cheaper than taking out a mortgage. By weighing the pros and cons on both sides, you can decide whether now is a good time to buy or rent in your area. Remember that trends might differ from one region to another – but with these considerations in mind, let’s look at factors to keep in mind when considering renting vs buying real estate for sale.
Millennial housing preferences
One of the biggest real estate trends you’ll see over the next 10 years is an increase in demand from millennial homebuyers. They are already one of, if not THE most important group of buyers in today’s market and will continue to be even more so going forward. That means that real estate agents need to understand their unique needs in order to provide them with a positive experience when shopping for their first home. The best way to do that? Think about what life was like for you at 23—your daily routine, your job (if you had one), your personal interests, etc.—and try to picture how those things could change two decades later. Odds are good that things have changed substantially and figuring out what they might look like can help realtors tailor their advice as well as create a better user experience overall.
Where will the growth be?
The where of real estate growth is fairly easy to predict: it will be in cities, and especially in walkable neighborhoods. By 2030, 66% of humanity will live in cities—an increase from 54% today. The world’s population is growing (which should cause demand for residential development) and aging (which causes people to need more accessible housing). Meanwhile, thanks to urbanization and government support, infrastructure investments like light rail will continue to develop across Asia, Latin America, and Africa—helping populations find jobs easily. As a result, these developments will attract new residents seeking an affordable living space with access to public transit.
Which cities will experience this growth?
According to experts, when it comes to urban development, two cities, in particular, are leading: Bangalore and Santiago. In terms of population growth, these two cities are also number one and two respectively. What’s more? They aren’t only some of India’s youngest cities—they’re some of India’s richest, too.
First-time homebuyers vs mature buyers
There are two types of buyers that make up a real estate market. First-time homebuyers and mature buyers. Mature buyers are looking to upgrade or have outgrown their current residence, while first-time homebuyers are looking to move into their first homes. The rise in housing prices has led many first-time homebuyers to take out additional loans for down payments, making it difficult for some low-income households to enter the real estate market.
