In 2022, we anticipate that the strong seller’s market will continue, the Sun Belt will remain the most sought-after region, and flexible work options will continue influencing home purchase decision-making.
Real estate investors also benefit from low-interest rates; more investors purchase houses intending to rent, reducing the available housing stock. The two buyers types, homeowners and investors, compete over ever reducing housing stocks, pushing up prices.
The number of renters increased even before the pandemic. Due to the large number of millennials reaching adulthood, there was record household growth. The Great Recession left 72 million young people with less disposable income and purchasing power than previous generations.
Furthermore, the baby boomer generation was a top-growing group of renters during the 2010s. People are selling their houses in retirement to live off rent and equity instead, and it is possible they cannot recover from the Great Recession and forcing them to rent.
Even though we’re in a recession, most markets are seeing high home prices. Why?It’s all about supply and demand. People are moving out of cities, apartments, and condos due to COVID. Short-term rentals and rising building costs are contributing to low supply.