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Southwest Florida Real Estate Market, 2022. What Can We Expect?


Following a record-breaking 2021, buyers and sellers want to know the answer to a very important question! Will the real estate market cool off in 2022? More specifically to the Southwest Florida market - is 2022 the year I will finally be able to purchase my dream home in sunny Southwest Florida, only minutes from the Gulf of Mexico? After all, it’s been an unprecedented competitive market for buyers in all price points.

 

While the past 18 months have been somewhat tumultuous, people are experiencing positive post-pandemic changes. Many employees cite the increased ability to work from home as an unexpected “benefit.” Employers have realized that employees may be better able to meet aggressive deadlines in the quiet comfort of home, where there are few distractions. The gorgeous weather in Southwest Florida is a HUGE attraction for those who enjoy the ability to telecommute! Many people are choosing to relocate to SWFL for all kinds of reasons.  Living in Florida can feel so much less cumbersome than living in many northern spots, lower crime rates, better winter weather, tons of outdoor dining and shopping choices AND Florida has no state or local income tax!

 

What does this this mean for the Southwest Florida real estate market in 2022?  According to RocketProInsight, the U.S. experienced an 18% year over year growth in homes prices, as recorded in October, 2021.  This is the highest growth rate in the 45-year history of CoreLogic’s Home Price Index. Moreover, the Naples, Florida area was ranked second for annual home price gains at a growth of 33.5% (2021)! The market does not appear to be slowing down anytime soon. Inventory continues to dwindle, and as we move into the 2022 “Florida Season”, we expect to see even more interested buyers with fewer purchasing options. Experts predict continued low inventory on new construction and existing homes and continued low interest rates. These factors, in addition to a significant number of cash buyers, will continue to drive the market prices higher.

 

 Economists agree there will be little room for a significant market cool-down any time in the near future but they also believe demand may be shifting to more affordable homes in 2022.  According to Brad O’Conner, Ph.D., chief economist at Florida Realtors in Orlando, the unprecedented influx of affluent buyers from the Northeast and California drove demand for the luxury market in 2021, potentially leveling off in 2022.  Nevertheless, this may not be true for Florida’s west coast market according to CoreLogic (2021).

 

As we approach 2022, we are seeing very little promise for price decreases any time soon. Sales in Lee county alone have seen a decrease in the number of listings by 14.3% between October and November 2021 (RocketHomes, 2021).  November alone favors sellers, with over 60% of Lee county homes sold at or above asking price (2021). Unfortunately for buyers, inventory has shown no signs of increasing in the coming months; this will lead to continued aggressive pricing.

 

 While home sales are likely to remain above pre-pandemic levels in 2022, buyers should expect an eventual slow-down dependent on the influx of inventory and rising predicted mortgage rates according to Dr. Lawrence Yun, chief economist of the National Association of Realtors (2021).  Although buyers should remain hopeful nationally, it remains difficult to predict a significant slow-down in the Southwest Florida market due to high demand.

 

Sellers may want to take this opportunity to sell high in 2022 before the market experiences a downward turn! If you have been considering the idea of selling, now may very well be the best time in the history of owning your home!  

 

Call Scott and Angela at 239.675.9464 for a confidential comparative market analysis today! Understand the value of your home in THIS unprecedented market!

 

 

 

References:

 

https://www.rocketproinsight.com/?qls=INM_REARPIns.splogo2021&dclid=CMmVpdDW1PQCFSKGWgUdmggDqg

 

https://www.rockethomes.com/real-estate-trends/fl/lee-county   

 

https://www.floridarealtors.org/news-media/news-articles/2021/10/sneak-peek-real-estate-

trends-florida-2022

 

https://www.rismedia.com/2021/11/18/housing-markets-normalize-2022-nar-lawrence-yun/

 

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