If you're thinking of selling your home this year, we've got some great news for you — real estate behemoth Zillow predicts that the national housing market in 2022 will remain in your favor. Home values are expected to continue rising, just as it did in 2021.
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"This growth has been fueled by historically low mortgage interest rates, pandemic-influenced decisions on where households want to live, and demographic shifts — both from aging millennials and retiring/downsizing boomers — that have all combined to keep housing demand very high," writes Zillow in its report.
The major difference between this year and last year is which specific markets will see the most advantages.
Zillow predicts that the fastest-growing real estate market in the country this year will be Tampa, followed by Jacksonville, Raleigh, San Antonio, and Charlotte. These cities rise to the top due to "strong forecasted home value growth, strong economic fundamentals including high job growth, fast-moving inventory, and plentiful likely buyers."
On the other end of the spectrum, the coldest markets are expected to be New York, Milwaukee, San Francisco, Chicago, and San Jose, which will be troubled by "relatively fewer new jobs and less favorable demographic trends." That said, Zillow still predicts that sellers will have the upper hand in these areas.
Zillow also anticipates that demand for housing will continue to be strong for the rest of the decade. "The boomer tide in the for-sale housing market is expected to continue to rise for at least the next eight years; younger millennials will be hitting first-time home buying age at about the same time, meaning the 2020s will be a period of sustained underlying demand in the housing market," the company writes.
That's not ideal news for buyers, unfortunately, as real estate competition could remain fierce if inventory remains low. And there's some more bad news.
"[M]ortgage interest rates are expected to rise in 2022, making home loans more expensive for aspiring buyers," writes Zillow. Of course, it also comes down to geography.
"Historically, home value appreciation in the following markets has strong negative correlation with interest rates — so if interest rates go up, these markets are likely to slow the most: San Diego, New Orleans, Washington DC, Los Angeles, San Jose, and San Francisco," the company explains.
To see more about the company's findings, read the full report here.