2022 Real Estate Outlook 

Here we will go over the 2022 real estate outlook. Read along to learn some important information that can help you with your next real estate investing venture and financial planning. You can find similar articles on the Startup Tandem blog!

real estate outlook 2022

Real Estate Investing- What is it? 

Before we get into detail, you must know that real estate can fall into several diverse categories. This can include commercial, industrial, or residential properties. Investing in real estate will involve purchasing, managing, or selling/renting your real estate to gain profit. 

A subspeciality of real estate investing, also known as real estate development, is the improvement of a property. This is usually done with real estate that has already been rented to improve the property for a better financial gain. 

If you do not want to personally manage or own a property, you can be part of what is known as passive investments. You can invest in real estate without having to do anything with the property. To do this you will want to invest in REITs or real estate investment trusts. Another way to do this is to invest in items such as crowdfunding. It will allow you to be part of the investment without having to commit your entire bank or manage the property.

PRO TIP: Learn which startups are the most profitable in this post! 

What to Take Away in 2022 

Despite the many setbacks that occurred during the pandemic, the outlook for the real estate investing was positive at the beginning of the year. However, mortgage interest rates became extremely high in 2022. In fact, between January and May it rose over two percent. 

As of June first, of 2022, the average rate of a fixed 30-year mortgage was 5.42 percent. The APR would be 5.43 percent. With that said, it is predicted by the end of 2022, the rate could be anywhere between four and a half percent and seven percent. For those who are on a 15-year mortgage the rates are expected to be between four and six percent.

Why are Mortgage Rates Rising? 

Inflation is currently over eight percent and that is causing the mortgage rates to rise. The Federal Reserve’s federal funds rate has increased. This rate is expected to keep hiking higher throughout the year. 

The globe is unpredictable. This is directly related to the war happening in Ukraine and the stock markets. The stock market is as unpredictable as it can be right now. 

Mortgage rates will raise at least another five times this year. This is simply due to the inflation happening across the country and world. 

When to Expect Rates to Stop Rising 

It is not looking good for mortgage rates in the next few years. It is expected that the mortgage rates are going to continue their upwards climb through the next years. However, when inflation slows down, the mortgage rates will not be rising as fast as they have been. 

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Some of the best places to purchase real estate in 2022 are the following areas. 

  1. Tennessee
    1. Nashville 
  2. North Carolina
    1. Raleigh
    2. Durham 
  3. Arizona 
    1. Phoenix 
  4. Texas 
    1. Austin 
    2. Dallas 
    3. Fort Worth
  5. Florida 
    1. Tampa 
    2. St. Petersburg 
  6. North Carolina 
    1. Charlotte 
  7. Georgia 
    1. Atlanta

Wrapping Up : 2022 Real Estate Outlook

Based on what has been stated as facts and what is projected, the mortgage rates are going to continue to rise. This also means that real estate investors are going to be extra cautious before investing. Many investors are going to opt in for REITs. This will allow them to invest without having to own or manage an entire property. They can invest and make money without having to do as much work and spend as much money. This means that if it fails, there is less money lost. This helps reduce the risk of losing money.

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