The pandemic has been upon us for quite some time now. While we all have been guilty of binging on various shows, many of us have also had nagging thoughts about whether it is a good time to make investments. Whether it was about buying cryptocurrencies, diving into the stock market or choosing to invest in real estate. We have all tried to watch a plethora of youtube videos and read as many blogs as possible to gather as much information as we could.
Some of you might also be wondering if it is sensible to even buy a house amidst this Covid-19 situation. So while you are contemplating whether to buy a house in the coming year, let’s take a look at the real estate trends expected in 2022.
Millennials Are Expected to Dominate the Real Estate Market
The prime age for first time buyers is considered from 26-35. Since most millennials fit this bill perfectly, a majority of first time home buyers would be people from this generation. With workplace flexibility continuing for a longer time,many professionals are spending more and more time in the comfort of their homes. Hence, many buyers from this generation are contemplating upgrading to a bigger and better house. This could also lead to the real estate market becoming more competitive and fast-paced.
Increase in Demand for Homes That Are Tech Equipped and Climate- Change Resilient
With the millennial pool almost equivalent to 1.8 Billion or almost 23% of the entire population, we can easily expect more millennial buyers in the coming years. This is a generation that is more tech-savvy and believes in sustainable solutions as compared to the previous generations. One can expect to see houses that have adopted smart technology and latest appliances.
Along with this, weather will also play an extremely important factor. With so many natural calamities increasing every year due to the climate change factor. Climate-change will become a dominating factor while considering buying a house. In order to appease the climate conscious home-buyers we could also see a rise in investments in climate resilient houses by the home sellers.
Increase in Mortgage Rates
Mortgage is one of the biggest concerns for many buyers. How do you calculate it? How can you afford it based on your income? Many mortgage calculators can help you solve this dilemma. Also, many experts are predicting a rise in demand in the real estate market. In the coming months, we can expect a rise of 3.3% in mortgage rates and almost 4% by the end of the year.
A gradual uptick in mortgage rates could become a major concern for many first time buyers, however, a demand for better households should keep the real estate market competitive. It should be noted that in the coming months it is very important to keep a close watch for any changes in policy of the mortgage market.
The Era of Digital Platforms for Auctions & Virtual Tours
Catering to a tech-savvy market comes with its own challenges. To find a niche in the market it will become vital to enable virtual tours that will allow the buyer to attend open houses through online tools. In order to improve listings one could expect real estate companies soon investing in superior quality photography, better virtual tours and short films that promote the neighbourhood.
With work from home becoming the new normal and more and more people choosing to work remotely rather than commuting to work everyday. One can expect to see a rise in online auction platforms that connect potential buyers and investors to their ideal property more easily. These auctioning platforms will allow investors and buyers to bid remotely, avoid travel in these pandemic times and explore more options with virtual access to different properties.
Digital Currency Against Property Transactions
We all are guilty about considering purchasing cryptocurrencies. With so much time on our hands, limited income and the world being shut. Many of us have had the time to consider and research about growing our investment portfolio. Cryptocurrencies especially Bitcoin, Ethereum etc have become all the rage. It looks like just a matter of time before cryptocurrencies become the new form of currencies. With so many people owning BTC and other forms of cryptos we could soon see an increase in digital currency being used in real estate transactions. Buyers sitting on digital currencies and sellers wanting to acquire more of them, we could soon see many property transactions taking place in the form of crypto exchange.
A Demand for Suburb Living and a Decrease in Prices of Urban Homes
Remote working has allowed couples to share more quality time with each other and even consider expanding their families. With a lockdown baby boom more and more people can be seen choosing to move to the suburbs. This has led to an increase in demand for suburb properties. Also with not having to commute as much due to remote working many people are preferring to move to a bigger and better suburb location that is closer to the city.
While more people are choosing to move to the suburbs this has led to a decrease in prices of urban properties. So 2022 could see more affordable prices for urban homes for those looking to move into the city.
A Step Closer to Normalcy
The beginning of 2020 had caused a lot of uncertainty and panic due to Covid-19. However, in spite of the pandemic the world has started returning to some normalcy. Although not a complete 180, the real estate industry could also expect some normalcy. Buyers and investors can expect fewer obstructions and smoother transactions.
The real estate industry is a dynamic one and not only will you notice it changing from quarter-to-quarter but also week-to-week. If you are contemplating whether ‘now’ is the best time to buy or invest in a property it is important to remember a few factors. Make sure to keep a lookout for the latest policies, current mortgage rate, planning your finances and collecting as much information as you can about the latest real estate trends. Also, always remember while investing in real estate don’t think of the cost, but think of the value.
