In a recent interview with Anywhere Real Estate CEO Ryan Schneider, he shared his belief that demand for houses is still high despite an approximate 20% drop in recent contracts for housing. He expressed that in his opinion, housing prices would likely stay stable through the remainder of 2022 while also acknowledging that we are likely to continue to see drops in contracts for housing purchases. There was also a comment he added, that rents are climbing. In short, housing demand remains strong with a housing shortage still in existence. This is likely to cause more growth in rental demand as housing ownership declines.
While every market is different, from what we are seeing, demand in growth market areas still seem to have more need for housing than there are available housing units. This would align with Mr Schneider’s comments. In the areas where active members of our team are currently working, there is an explosion of new rental construction. Another item of note, is that when people need housing and purchasing seems to be a challenge, we predict you will see a rise in variations of seller financing. We believe that it is likely we will continue to see more corporate and larger investor acquisition of rental units at least until inflation stabilizes.
It is not unexpected that in a transition phase of a market cycle that changes in prices will lag behind a change in demand. This has historically been true of up or down swings in the housing market cycles which can be largely supported by data from the Federal Housing Finance Agency. Markets have cycles. It is not to be worried but prepared to adjust with the changes. Opportunity still abounds. We hope that this information helps, but we can not and do NOT offer tax, accounting, financial, legal, nor investment advice.