New England Real Estate Trends in 2022
As the year draws to a close, with it comes both the revision of the past year’s housing market and predictions for the next. Although the past year was nothing short of tumultuous, there were still some standout trends to reflect on and some indicators for what may lie ahead.
The Hottest Housing Market
What we can only assume is a continuation from the mass city exodus of 2020, the housing market of 2022 saw a lot more people purchasing real estate in lesser populated areas, interestingly enough, specifically in New England. In years prior, the South had dominated the housing market with cities such as Austin and Phoenix growing at rapid rates. In 2022, however, we saw a shift in popularity, as the New England housing market boomed.
More than half of the hottest zip codes for those looking to buy homes were in New England. There are numerous reasons for this shift, but it is largely thought that the versatility of New England was appealing to those who realized during the pandemic that limited options are not ideal in the face of crisis. The concise layout of New England allows residents to have access to the beach, rural wooded areas, hiking and skiing mountains, all within an at most a few hour drive from a major U.S. city.
Additionally, although New England is by no means cheap compared to the vast majority of the United States, the influx of buyers were largely out-of-state and coming from large cities where the nearly million dollar price tag that adorned many houses was chump change in comparison to major city real estate.
Increased Interest Rates
Another major occurrence in the real estate world happened just recently. As inflation began to spiral out of control, one tactic the Biden Administration has implemented is allowing the Federal Reserve to raise interest rates in the hopes that not only would this deter the changing value of the dollar but also not send the economy spiraling into a recession.
As this change has been implemented, obviously mortgage interest rates have been affected and the amount of people willing to sign on to such debt has decreased. Although a recent change, the housing market has already started to slow down and it is predicted that this trend will continue into the next year. Experts doubt this will persist for the entirety of the year and do expect the rates to drop, however, they also expect the prices of homes and real estate in general to drop as well.
The past few years have been a whirlwind for the housing market, unforeseen event after unforeseen event has seemed to push and pull the prices of homes and the direction of people in unpredictable ways. Although we are by no means at a standstill or in the figurative clear of the inconsistencies, one thing is certain, it’s never a dull moment when you deal in real estate.