It seems as though any discussion about real estate these days is quickly dominated by the lack of inventory of homes for sale. Since the start of the pandemic, more Americans have been on the move in search of more space. So when can we expect the housing inventory of homes for sale to reach pre-pandemic levels again? The recent Home Price Expectations Survey consulted more than 100 market experts and economists to predict upcoming home supply trends as well as how that might affect future home values.
A look at the numbers
During 2019 (pre-pandemic), there was a monthly average of 1.6 million units for sale. By year #2 of the pandemic in 2021, we saw this monthly average drop to approximately 1 million units. So far in 2022, these numbers appear to be even lower for the time being.
As for expectations from the survey participants, they were as follows:
- 79% expect a return to normalcy before 2025
- 38% expect inventory levels to 1.5 million units monthly by the end of 2024
- 37% expect inventory levels to 1.5 million units monthly by the end of 2023
- 4% expect inventory levels to fully recover by the end of 2022
What about home values?
Home values have skyrocketed by 32% over the past 2 years with 19% appreciation coming in 2021 alone. With this said, these prices are predicted to grow by a more modest 9% in 2022. Of course, by historical standards this is still quite robust price appreciation. When it came to predicting where prices are going between now and the end of 2026, respondents forecast a 26.8% cumulative rise, on average.
Summary
If there is one main takeaway from the predictions above, it is that the real estate market should be on good footing overall for the next several years. With prices rising so quickly over the past few years, many have wondered if we were experiencing another real estate bubble. As always, all real estate is local though. When it comes to South Florida, the extremely strong demand for housing is not expected to slow down anytime soon. With a record number of Americans relocating to The Sunshine State, this may be a great time to own some investment properties.
At Live South Florida Realty, Inc. we have assisted many clients with their real estate needs. Are you looking to buy or sell a property in South Florida? Now more than ever, it is critical to have a qualified real estate team and the proper search tools behind you. Live South Florida Realty, Inc., has been a leader in the South Florida market for many years. Let our team of professionals assist you with buying or selling your piece of paradise today! In addition, our recently launched “Florida Home Search” app is now available on the Apple App Store and Google Play Store. With real-time MLS feeds, this app lets you set your own alerts to notify you as soon as a property meeting your needs hits the market. Furthermore, it will also let you know of recent closed sales in your area so that you may be even more educated on the market. Be sure to download this app for your smartphone or tablet today!
