2022 real estate steering factors
What are the factors that will shape Lowcountry real estate sales in 2022 ? Here are our thoughts on what will be most impactful in the months ahead :
We ’ ve all heard ( or said ourselves ) the following : “ I ’ d sell in a heartbeat , but then I ’ d have no place to go !” Such is the vicious cycle of our low inventory challenge , and we expect it to continue further into 2022 . It would seemingly take some dramatic / significant event to turn content homeowners into sellers , and we do not have any basis to predict this happening anytime soon or in any dramatic fashion . As such , we expect inventory to
A specialist for every task Meet our professional staff . They ’ re anything but ordinary .
Meaghan Beck Listings Manager Licensed SC Real Estate Agent
Julie Smythe Success Manager Licensed SC Real Estate Agent
Karen Lesch Closings Manager Licensed SC Real Estate Agent
Ashley Lindblad Director of Marketing & Community Relations
Annette Rothwell Director of Operations
Taylor Brunn Closings Coordinator Licensed SC Real Estate Agent
remain low , which generally sets up to favor sellers for the foreseeable future .
The sharp spike in Omicron cases in January across the country ( and Lowcountry , of course ) caused widespread disruptions in the real estate cycle for the market kick-off in 2022 . These disruptions are expected to be short-term , while the bigger factor is what we might see in early Spring . If COVID cases settle dramatically , we may arrive in a new era of confidence and enthusiasm that could fuel a new wave of buyer and seller activity . Conversely , others have renewed their own interest in calling the
Cameron Clark Listings Coordinator
Wendy Sanders Team Support Specialist
Gail Bonnett Client for Life Coordinator
Carrie Collins Staging and Interiors Specialist
Dawn Hoffman Systems Manager
Kent Collins Business Development Advisor
Lowcountry home , resulting in an increased level of property retention and a corresponding decreased level of property turnover . At the same time , rising property values , downsizing / simplifying , and general changes in housing needs are certain to fuel a much-needed level of new listings in the first two quarters of 2022 . Therefore , inventory is shaping up to be the key steering factor in how the 2021 real estate market unfolds .
While we are not expecting any drastic increases in mortgage interest rates , we are pretty confident that rates will climb in 2022 . In fact , indications here are the start of the year are that second home rates may experience a bump as early as April 2022 . Since rates will still be historically low and extremely attractive , the challenge isn ’ t the rates themselves , rather the increase in rates as real estate values have climbed so significantly . The net-effect is reduced affordability as the borrowed-dollar doesn ’ t buy as much real estate as it once did , while some buyers ( especially first-time homebuyers ) need all the buying-power they can get .
Work From Home ( WFH ) is here to stay for a certain percentage / segment of companies , as workers desire autonomy , flexibility , and the opportunity to relocate to a more desirable location to meet their work obligations remotely . As such , we continue to see more and more people move to the Lowcountry where they can significantly enhance their quality of life ( weather , natural amenities , year-round activities , etc .) in their WFH mode . This movement is additionally fueled by “ life is short ” and “ why wait ” mentalities that are compelling accelerated purchase timelines among those who may have been waiting to move upon retirement .
While we have all been impressed with the sharp increase in real estate values locally , we are not nearly unique in that vein as values have jumped dramatically across the country . The Hilton Head / Bluffton marketplace has long-since been a relative “ value ” in comparison to other coastal communities , and it still is . We expect this to continue to drive additional interest among buyer prospects , especially those who are selling high in areas like New York and California , only to buy here in the Lowcountry , feeling like they hit the lottery .
The old adage of “ what goes up must come down ” has some homeowners wondering just how high values can realistically climb before they peak and perhaps begin to decline . Most folks like the idea of buying low and selling high , so we expect that some segment of owners will enter the marketplace this year amid concerns that values may be at , or near , the top . Meanwhile , other sellers are choosing to enter the market more so on an “ opportunistic ” basis … they ’ ll sell if , and only if , the market delivers a hefty price for their home . In either case , inventory is welcomed ( and needed ) in the coming months , and we expect sellers will continue to experience ( and enjoy ) a very favorable market for months to come .
COST OF LIVING
Supply chain challenges , inflation , and labor shortages are just a few factors shaping the current cost of living , and it seems clear that these won ’ t be corrected in any short order . These directly impact not only our individual purchases and expenses , but also those of our service / maintenance / construction providers , who have no choice but to pass those costs along to the consumer , forcing the cost of home ownership to rise . Adding to this , on another front , we are watching with anticipation what the effect of Flood 2.0 ( FEMA ’ s new flood insurance rating program starting with policies in 2022 ) will have on the cost of flood insurance in our area . In some cases , the premium increases will be significant , which could possibly sway buyer ( and seller ) decisions in the months and years ahead .
12 | Collins Group Realty Results 2022 | 13