The real estate market in Florida has been thriving. There has been an increase in population growth which has of course encouraged demand for rental properties as well as luxury […]
Even with International travel bans, South Florida home sales to international buyers remain strong. This little pocket of paradise known as South Florida has outperformed the rest of Florida and […]
The real estate market in Florida has been thriving. There has been an increase in population growth which has of course encouraged demand for rental properties as well as luxury real estate. Mortgage interest rates are going up for the first time in a while and are expected to reach 3.60%, an increase from the current rate which is 3.30% by the end of 2022. Several housing experts have predicted where they think the real estate market is headed in 2022. Here’s what they had to say:
Danielle Hale, Realtor.com chief economist:
We expect a whirlwind 2022 for the housing market. Home sales are expected to increase another 6.6% and home prices to rise another 2.9% on top of 2021 highs. A gradual uptick in mortgage rates will make affordability a top consideration for home buyers, especially the 45 million Millennials aged 26 to 35 who are at prime first-time homebuyer age. Demand from these young households will keep the market competitive and fast-paced despite a small uptick in housing inventory as builders continue to ramp up production, increasing single-family starts by 5% in 2022.
Daryl Fairweather, chief economist for Redfin:
After two years of unprecedented uncertainty in the housing market, we’re expecting 2022 to be just as unpredictable. We expect 30-year-fixed mortgage rates to slowly rise from around 3% to around 3.6 by the end of the year, mostly attributed to the pandemic subsiding and inflation continuing to linger. By late fall, high mortgage rates, paired with already high housing prices, will likely slow annual price growth to roughly 3%.
This low price growth will likely discourage speculators from entering the market, giving first-time homebuyers a better chance at securing a home.
In 2022, we also predict home buyers will start considering climate change as a major factor in their home-buying decisions, as natural disasters and extreme weather events continue to increase in frequency. Home sellers will also likely make significant investments in climate-change resilient home features to appeal to climate-conscious home buyers.
Keith Gumbinger, vice president of mortgage information website HSH.com:
Home sales in 2022 should be solid overall, but high home prices will likely be joined by higher mortgage rates, tempering sales compared to this year. The outsized annual increases in home prices seen in 2021 should slow in 2022, but even so, will leave home prices at or near record highs. At the same time, mortgage rates will tend to be firmer as the Fed ends its bond-buying programs and begins to lift interest rates by the middle of the year. Pricier homes financed with higher mortgage rates will exacerbate affordability issues, and this can be expected to dampen demand from homebuyers on the margins of the housing market.
In general, housing affordability seems to be falling. The volume of inventory of homes for sale fell behind the demand of buyers seeking property to buy. A lot of locals are grappling with affordability as Florida has seen an influx of foreign wealthy Investors with low taxes who have been swooping in and snatching up available inventory.
“It’s not a bubble, it is about the fundamentals,” said Jenny Schuetz, a housing researcher at the Brookings Institution. “It is about supply and demand — not enough houses, and huge numbers of people wanting homes.”
The pandemic destabilized the housing market, as the job market was stalled and the supply of homes to buy has seen a drop as a result of the restrictions associated with COVID-19 as well as supply chain shortages. So buyers need to prepare ahead of time as they are entering a hot as well as one of the most profitable markets to date, it is important to research ahead of time to avoid panic buying and to stick to a reasonable budget.
“Buyers may have a little more time compared to 2021 to make a decision, but given that it will still be a seller’s market, they’ll still likely have to move fast to keep up with that market velocity, Hone in on your home buying budget so you have a firm plan of what you’re willing to spend for a property that meets your needs. Buying a home isn’t just a financial decision. It’s also a lifestyle choice. Buying a home should make sense for your personal and financial situation.”
Odeta Kushi, deputy chief economist at First American Financial Corporation advises.
Even with International travel bans, South Florida home sales to international buyers remain strong. This little pocket of paradise known as South Florida has outperformed the rest of Florida and the Nation in international home sales for 2021.
Foreign buyers purchased $5.1 Billion of residential real estate in south Florida during 2021, only down 9% from 2020 ($5.6 Billion). Statewide Florida saw a 22% volume decline, $12.3 Billion in international sales in 2021, compared to $15.1 Billion in 2020. Nationwide saw an even larger decline in volume of 27% ($54.4 Billion in 2021, and $74 Billion in 2020).
“For South Florida international home buying to remain essentially on par with the previous year despite the lockdowns and bans on international travel speaks to the incredible resilience and the allure of our market.” MIAMI Chairman of the Board, Jennifer Wollmann said. “We expect a significant increase in foreign visitors once the U.S. opens its borders to international travelers on November 8. Global buyers purchase in Miami because it is a world-class global city with better real estate prices than other similar global cities. Foreign buyers feel at home with our diversity and acceptance of all cultures.”
Florida has been the No. 1 state for foreign home buyers for the last 13 years.
According to the Florida Realtors 2021 Profile of International Residential Real Estate Activity in Florida, over half (52%) of all international home sales in Florida are in the South Florida Tricounty area (Miami-Dade, Broward, and Palm Beach Counties). Orlando Finished in second with 10%, and Tampa third at 8%. One in five homes sales happen in Florida, and one in two in Florida are in the Miami Metro Market area.
Top Countries in South Florida
The top countries for buyers purchasing residential properties in South Florida are:
1. Argentina (13% of South Florida foreign purchases)
2. Colombia (12%)
3. Venezuela (10%)
4. Mexico (7%)
5. Chile and Brazil (6% each)
6. Peru and Canada (5% each)
7. Ecuador (4%)
8. Spain and France (3%)
Top Countries in Miami-Dade
The top countries for buyers purchasing residential properties in Miami-Dade County are:
1. Colombia (15%)
2. Argentina (14%)
3. Venezuela (10%)
4. Mexico (8%)
5. Brazil and Peru (7% each)
6. Chile and Canada (4% each)
Other countries purchasing in Miami include: Ecuador, Spain, France, Bahamas, Dominican Republic, Honduras, Costa Rica, Barbados, Bolivia, Paraguay, Egypt, Israel, Iraq, Iran, Turkey, Greece, Italy, Switzerland, Spain, Portugal, United Kingdom, Sweden, Russia, China, India, South Korea, Malaysia, Vietnam, Indonesia, Japan, Cuba, Haiti, South Africa, Singapore, Jamaica, Czech Republic, and more.
Top Countries in Broward
The top countries for buyers purchasing residential properties in Broward County are:
1. Argentina (17%)
2. Colombia (15%)
3. Peru (8%)
4. Canada, Venezuela and Chile (7% each)
5. Brazil, Dominican Republic, Haiti, Mexico and Spain (3% each)
Other countries that purchased properties in Broward included: Bolivia, Ecuador, Bahamas, China, Czech Republic, India, Iran, Italy, Jamaica, Singapore, South Africa, United Kingdom and Uruguay.
Top Countries in Palm Beach
The top countries for buyers purchasing residential properties in Palm Beach County are:
1. Argentina, Brazil, Canada and Colombia (18% each)
2. Chile, Peru and Ukraine (9% each)
What’s Changing In Florida Real Estate?
UncategorizedThe real estate market in Florida has been thriving. There has been an increase in population growth which has of course encouraged demand for rental properties as well as luxury […]
Real Estate in South Florida remained strong in 2021, even amongst International Buyers despite COVID travel bans
UncategorizedEven with International travel bans, South Florida home sales to international buyers remain strong. This little pocket of paradise known as South Florida has outperformed the rest of Florida and […]