09 Mar What to expect this spring in real estate
What to expect this spring in real estate?
This is an unusual spring for Minnesota real estate. We have a combination of coming out of a pandemic (fingers crossed), high inflation, low housing inventory, and interest rates on the rise. With all of these factors in play how will this spring real estate market play out?
Here is what I see for this spring real estate market in Minnesota.
· Look for the Federal Reserve to raise interest rates March 15th and two to three more times in 2022. Interest rates are one of the few tools the Federal Reserve has to use to scale back inflation. The rise in fuel prices with the Russian invasion of Ukraine has impacted the world with higher gas prices. Fuel costs affect costs of products and is a major component of inflation. So, while the Federal Reserve raises interest rates it will have no affect on the price of gas and truly little help to bring down inflation. But slowing down our economy will affect inflation.
· Our historically low inventory creates more buyers than homes and this means multiple offers and escalating home prices. This spring that will continue.
· The ending of the pandemic will pull more buyers, and hopefully sellers, into the market and make this spring even more busy.
Add all of those factors together and we will have a spring of buyers trying to purchase before rates get so high, they cannot afford a home, low inventory with more buyers than sellers and more players in the marketplace as the pandemic subsides. So, everyone…get your running shoes on!
I hope this blog about what to expect this spring in real estate.
Look for more articles and videos in the future on various aspects of real estate and our state of Minnesota.
Real estate is a wonderful investment!
The Anderson Team