What’s Next for the Housing Market in Maryland?

There has been a lot of uncertainty as of late about what’s next for the housing market in Maryland. Here at Innovative Properties, a property management company in Annapolis, MD, we have been keeping a close eye on what has been happening and what that most likely means for the future.

What’s Next for the Housing Market in Maryland?

Most experts agree that 2022 will see continued rebalancing. However, with price growth anticipated to slow in 2022, some contributing factors will be essential to consider.

•  Inflation and Rates – Currently, high inflation means that the Federal Reserve will likely increase interest rates, and in turn, mortgage rates. Many experts expect that the current average 30-year rate of just over 3% could climb over 4% in 2022.

• Seasonality – The pandemic was a market disturbance no one saw coming. However, as we expect life will eventually return to normal, so do the seasonal cycles of the real estate market. As a result, slower inventory is back on the rise during this Fall and Winter season.

• Employment Changes – Working from home allowed many buyers and renters to steer clear of the cities in favor of the suburbs. That said, if companies decide to return employees to the office, it may shift some of the population back to urban areas. Thus, changing some of the inventory and price dynamics in these areas

Estimates and both housing and rental market predictions vary depending on who you talk to. For example, no one could have predicted just how much the market would change during the pandemic. So, entering a new year as life returns to typical demands that buyers be vigilant. Moreover, national predictions and trends do not always translate to every smaller market. In fact, each state, county, and neighborhood has its own unique factors that determine demand and pricing.

Is Renting the Better Option in 2022?

Should you Buy or Rent involves many other more minor decisions. Individuals and families must evaluate their goals, desired location, budget, and priorities when determining their housing options. Looking forward to 2022, rental market predictions echo the effects of a turbulent year in the real estate industry. With so many uncertainties in the housing market, renting has become an attractive option.

Why Is Renting the Better Option?

Low home inventory and higher prices have made the home buying process a cutthroat business. While the market shows signs of balancing, circumstances right now still favor sellers over buyers.

Renting is an excellent option for buyers who aren’t interested in overpaying for the few houses on the market. Plus, with prices at nearly record highs, renting can save money while buyers plot their next move.

Unlike the housing market, rental market predictions show that prices will remain more stable at the beginning of 2022. While prices did go up during the pandemic at a rate of around 6.0%, it was not as dramatic as home prices.

With so many people dealing with the pandemic’s job and income uncertainty, renting offers much more flexibility than a mortgage. In 2020, 16% of renters decided to renew a lease instead they purchased a home. Meanwhile, many others chose to move to a cheaper apartment to cut costs. However, a homeowner cannot quickly move to lessen a high mortgage payment.

Reasons to Consider Renting Over Buying

• Try Before You Buy – By renting an apartment in the area, you eventually want to buy in allows individuals to try things out. In addition, renters get to see what a place is like day to day without a high level of commitment. After all, everything from traffic congestion to amenities and outdoor parks can influence a homebuyer’s decision. Thus, by renting first, if the area is not quite what you thought, moving is still an option.
• Landlord Incentives – As renters vacated downtown in favor of the suburbs, many landlords offered incentives to increase occupancy. Whether it is a reduced rate, free amenity, flexible term, or waived fees, renters can still benefit from these move-in specials in many metropolitan areas. However, as rental market predictions indicate a growing demand for rentals, these specials may not last long!
• Save on Maintenance – Nothing is worse than moving into a new home only to have the furnace break down or find out that the roof really does leak. As a homeowner, this financial responsibility is solely on your shoulders. However, renters have an advantage that maintenance costs like these fall on the landlord. Even minor repairs can severely impact a tight budget, so renters have the upper hand in saving on maintenance costs and even utilities.

Need Professional Property Management in Anne Arundel County?

Are you looking for professional property management services in Anne Arundel County? At Innovative Properties we specialize in turnkey property management solutions for residential homeowners and commercial property owners in the Annapolis Maryland area. Property owners can feel at peace knowing that Innovative Properties is managing their investment. We treat each property we manage as if it were our home and our core principles of honesty, integrity, and professionalism are at the core of each service we offer. Learn more about our services by contacting our team today.