If there’s one thing that’s a certainty in real estate, it’s that nothing is ever certain.
As real estate developer Corey Shader explains, no one predicted that the outbreak of COVID-19 overseas would eventually burst into a worldwide pandemic that had an immediate effect on all aspects of life.
The effects were perhaps nowhere more prominent than in real estate. The onset of the pandemic in March of 2020 put an immediate halt to just about all real estate transactions. A few months later, though, that all changed.
Demand for housing boomed thanks to a number of factors all coming together at once. Renters in cities looked to purchase homes in the suburbs at the same time that more millennials — and even some Gen Zers — entered the market. Mortgage interest rates reaching all-time lows added to the demand.
That caused a huge shortage of housing units — 3.8 million by the end of 2020, according to estimates compiled by Freddie Mac. And the extreme housing shortage resulted in escalating prices, bidding wars, and many prospective homebuyers being left in the dust.
In 2021, people had to significantly alter their expectations or budget — and sometimes both — if they wanted to purchase a home. According to the National Association of Realtors, the median home sale price increased by nearly $41,000 from September 2020 to September 2021.
Now, going into 2022, the question remains whether real estate prices will ever return to “normal” again.
As many experts are predicting, Corey Shader believes that the overall housing market will remain strong for sellers in 2022. With buyer demand still remaining high, it’s likely that real estate prices aren’t going anywhere in the near future.
This point will be exacerbated for prospective homebuyers by the fact that so many homes have already changed hands in the last year and a half. Realtor.com, for instance, reports that active home listings are down 22% this year compared to last, and that number could increase even more in 2022.
Fewer homes available for sale combined with buyer demand that hasn’t subsided and mortgage rates that will likely remain low could actually lead to a further increase in home prices rather than a decrease.
Like many others in the industry, Corey Shader isn’t concerned about the housing market crash in 2022 because the housing supply is still really low. In addition, mortgage companies now have stricter rules for lending, which helps to prevent a massive amount of defaults.
All in all, real estate prices are not likely returning to “normal” in 2022, thanks to a number of mitigating factors from the past two years that are still as relevant as ever.
About Corey Shader
Corey Shader is a self-made entrepreneur, consultant, investor, real estate developer, and founder of several companies, notably Insurance Pipeline. Operating primarily out of Ft. Lauderdale, Corey’s endeavors span across the nation, consulting for start-ups, and sitting on the board of digital media and senior healthcare agencies. As a consultant, Corey helps young businesses develop sales funnels and maximize profitability. Shader takes pride in challenging others to push themselves to be their very best — he believes in constant self-improvement, inspiring others through sharing his own life experiences.