At the start of the pandemic, no one really knew what direction the real estate market would take. Before long, it was clear that it wasn’t slowing down.
As a result, homeowners who sold in 2021 earned a median profit of nearly $100,000, according to ATTOM data. That margin represents a nearly 46% gain from 2020.
The return on investment was the largest for home sellers since at least 2008. Profits rose in 90% of the 173 metro areas that were surveyed.
Profitable returns on investments aren’t new in the real estate world. The trajectory of profits has risen over the last decade for consecutive years. The difference since the pandemic has been the rate at which they have gone up. Between 2020 and 2021, profits shot up by more than 10%. As far as the median home price, it gained 17% in 2022, which is record-breaking good.
The big question before many home buyers and sellers is what’s in store for 2022. Will prices and profits continue on their current path? It’s unlikely. ATTOM flags some signs that could indicate price flattening in 2022.
If projections pan out, the market will see a slight decline to profits and to affordability as prices continue to rise. A repeat of 2021 is doubtful. The imbalance between demand and supply is likely to drive prices upward, but perhaps not as aggressively as the last two years or so.
Many real estate watchers will remember 2021 as one of the greatest years for home sellers, and one of the more difficult ones for those who tried to break through the barriers of homeownership.
The highest profits were realized along the West Coast; Boise led the way with a gain of 121.8%. Virtually every region tracked by ATTOM experienced some level of increase to the median price of at least 10%.
Home sellers who placed their properties on the market were relative newcomers to ownership. They had lived in their homes for an average of about six years before deciding to move on. The average amount of time spent in the home before selling dropped over the last couple of years as more homeowners saw an opportunity to make a substantial profit.
As a homeowner, you may also be weighing your options, wondering what your place is in today’s market. Whether buying a smaller home or upgrading into something that better suits the needs of your growing family, our real estate professionals can help you reach your goals.
As interest rates begin to head in the opposite direction, you might also consider a refinance mortgage loan that lets you reduce your monthly mortgage payments or secures you a lump sum of cash through your home’s growing equity.
Whatever your real estate vision is, we can help. Please contact us today to learn about how you can take advantage of today’s market dynamics and fulfill your next real estate dream.