2021 was a WILD year in the housing market across the country. Middle-class homes were flying off the shelves with multiple offers and selling in record time. Inventory levels dipped below 2 months multiple times which hasn’t happened in decades. And…all of this managed to happen in the middle of a global pandemic.
Now that it is 2022 I wanted to put out some predictions to what I think is to come in 2022.
Inventory remains low throughout the year
The inventory issue is well known and documented. The unfortunate thing is that I don’t think it’s going away for the foreseeable future. I think that it will be a problem for at least the next 3-5 years. Low inventory is a complex issue and there is currently nothing being done that is going to solve it.
So for 2022, buyers will need to continue to be prepared, decisive, and diligent when they are looking for their homes. There is simply not enough.
Edmonton prices will raise 5% over the course of 2022
Home pricing will continue to rise in 2022. Inventory levels will have a direct impact on what happens with home prices, as always. It’s simple supply and demand. Until something happens with the inventory issue home prices will continue to climb.
Edmonton is also one of the fastest growing cities in Canada, with people seeking asylum from the nightmare prices of the areas in and around Toronto and Vancouver. This is definitely a factor for our inventory issues and our increase in home prices. The beautiful thing about that is it makes our property value increase very sustainable.
Mortgage rates increase
Mortgage rates started to slowly climb in the second half of 2021, and I think we will see mortgage rates continue to gradually increase through 2022. Most economists are predicting that the Bank of Canada will raise their rate once or twice in 2022. Some lenders are already making adjustments in anticipation of that increase as well as a higher rate of inflation.
The good news is that mortgage rates have been lower than average and any increases coming will likely just be a correction back to average rates.
Condos bounce back!
Condos values and sales volume took a huge hit in 2021. I think that they will bounce back a little in 2022. I haven’t heard or read anything that supports that statement, I’m just throwing it out there.
I met so many great clients, colleagues, and friends in 2021 and I can’t wait to carry it forward into 2022. I’m never too busy. Reach out, or send a note so I can reach out.
See you out there!
-Thomas