Monday, November 15, 2021 / by Shane Kilby
Here is your fall update on our Northern Alabama real estate market.
It is the fall 2021 Holiday season. We are super excited and we hope you are too. We wanted to take this time to wish you a happy Thanksgiving. We’ve accomplished a lot this year, and we wouldn’t be here today without your support. We hope you have a great Thanksgiving dinner.
Now let’s talk about the state of the market this fall:
The statistics show that we might be at a peak right now. That’s not a bad thing, but it does mean that our appreciation might slow. For the last 10 months, Alabama has seen about 15.5% appreciation. Our 2022 forecast is around 5% to 6% appreciation.
We’re looking at a cumulative appreciation of 31.8% by 2025. So adding together the expected appreciation of 2021, 2022, 2023, 2024, and 2025, we should have just over 30%. If you purchased a $300,000 property in 2021 and plan to sell it in the peak of 2025, it should be worth around $390,000 to $400,000. Not a bad return in just five years.
Mortgage rates are always on the tops of buyers’ minds. A lot of buyers are waiting for prices to fall, but there’s no indication that we’re headed for a crash. Interest rates look like they will go up next year to 3.25% to 3.75%. No one knows exactly how much they’ll rise, but we're already starting to see this trend.
We’re still in a seller’s market, and we expect that to continue for the near future. Inventory is rising, but it is going up slowly. If you’re on the fence about buying, you should get off the fence and buy now because it will only be more expensive to buy next year. If you’re looking to sell, now is the time to do so and find a new property before interest rates rise.
If you have any questions about real estate, please call or email us. We’d love to help you.