3 Housing Market Predictions for December
For this week's real estate update I wanted to share a recent article from Motley Fool.
Key points
- Whether you're buying or selling a home, it's important to keep tabs on the real estate market.
- While we can't predict what will happen this month with certainty, here are some likely scenarios.
- Inventory likely won't change much, mortgage rates could fluctuate, and price gains could slow down.
If you're looking to purchase a home, you may be inclined to put your house hunting on pause until the holiday season is over. Or, you may be eager to keep scrolling through listings and attending open houses in an attempt to scoop up a place to call home. And if so, it's important to keep close tabs on the real estate market.
Similarly, if you're in the process of selling your home, you'll want to know what to expect in December. Without a crystal ball, we can't say with certainty what housing market conditions will look like. But based on what we know right now, here are some real estate predictions for December 2022.
1. Inventory won't drop, but also won't pick up
In October, the inventory of unsold existing homes dropped for the third month in a row, according to the National Association of Realtors. We probably won't see too extreme a decline in inventory in December, but we also shouldn't expect a ton of new listings to hit the market.
That's good news if you're a seller. It means you won't have to worry about facing steep competition right away. It's not such great news for buyers, though.
The more homes that hit the market, the more choices buyers get. And an uptick in real estate inventory could do the trick of driving home prices down to a more affordable level. At a time when it's gotten so expensive to take out a mortgage, that's important.
2. Mortgage rates will fluctuate, but mildly
Mortgage rates can shift from week to week and month to month. In December, we might see them rise slightly or fall a bit. But we're unlikely to see a drastic change in borrowing rates. That means buyers don't necessarily have to worry about mortgage rates rising to 9%. But they also shouldn't expect them to rapidly fall to the 5% mark, either.
3. Home price gains could slow even more
Home price gains have been declining steadily over the past few months. As such, it's not unreasonable to expect that trend to continue into December.
Now this doesn't mean that home prices are about to drop to more affordable levels. Rather, it's just that sellers might walk away with lower profits in December than they may have earlier on in the year.
To put it another way, buyers shouldn't be on the lookout for heavily discounted homes in December. That's just unlikely to be the case. But sellers also shouldn't despair or worry that they won't wind up happy with their sale prices. Sellers are still in a great position to profit on home sales -- just not to the same extreme degree as earlier.
All told, it'll be interesting to see how real estate market conditions play out in December. We could see a lull in home sales due to disruptions from the holiday season. Or maybe not -- it's hard to know. Either way, whether you're looking to buy or sell, keep paying attention to housing market news so you know what to anticipate.
To view the entire article, see https://www.fool.com/the-ascent/mortgages/articles/3-housing-market-predictions-for-december/
With interest rates starting to ease we are seeing some new opportunities for buyers and sellers. Lenders are offering options for home buyers to buy down their interest rate and sellers in some cases are offering credits to help buyers obtain a more affordable rate.
If you would like to discuss today's market and whether now is a good time for you to buy or sell, give me a call at (562) 900-9430.
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