2022 Spring Market Snapshot

Explore trends and solutions available to real estate players this spring

Take one look at NAR’s newsroom, and the trends and challenges within the real estate industry may seem straightforward—yet the causes and solutions are more difficult to define.

Some of the questions we face as the spring market kicks off are:

• What will inventory look like this spring?
• As mortgage rates begin to rise, how will this impact housing affordability?
• What are the biggest challenges agents will face this spring?

We’ll dive into all of this and more with our spring 2022 snapshot, featuring insights and predictions from real estate professionals and industry experts. So, buckle up, and let’s discuss how agents can address and overcome challenges to make real estate move this spring!

Trends, challenges, and underlying causes

Low inventory

In November, NAR’s Chief Economist, Lawrence Yun, shared his prediction that more inventory would open up as the mortgage forbearance program came to a conclusion and many homeowners needed to sell. But since, the program has been extended, making it possible for homeowners facing financial repercussions from the COVID-19 pandemic to stay in their homes. As a result, predicting what inventory will look like this spring becomes much more challenging. Of course, there are other factors affecting inventory. Housing starts were up in 2021, and fear of the coronavirus seems to be having less of an effect on homeowners’ willingness to sell (at least compared to the height of the pandemic). While we had hoped to see a significant uptick in inventory, we’ll inevitably be facing another lower-inventory market this spring.

Of course, the price of purchasing a home isn’t the only factor that goes into being able to afford a home. One element that’s often overlooked, especially among first-time homebuyers, is the cost of owning a home. From utilities and HOA fees to maintenance and repairs, the costs of owning a home add up quickly. With many recent home buyers waiving contingencies to put forth competitive offers, the cost of owning homes will likely increase as new homeowners face more repairs and renovations after closing.

Making sure homes are repaired and renovated before listing is one way that agents can help both sellers and buyers. Doing so allows sellers to earn top dollar for their homes, one of life’s most significant investments. Pre-listing improvements also help meet the needs of buyers looking for the sense of control that comes with buying a brand-new home.

Cost of construction labor and goods

With homeowners continuing to spend significantly more time at home, demand for home improvements remains high. This spreads the availability of home improvement goods and services thin. Lack of construction labor and materials is one of the historical and current factors fueling the inventory shortage. The solution is two-pronged. On one side, we’ll need to develop more houses to fit the needs of our growing population. On the other side, we’ll need to put resources into improving our existing, outdated housing stock to fit the needs of today’s homeowners.

Environmental impact

There are increasing concerns about how the environmental footprint of our homes is impacting climate. With climate as a focus for both national and international governments, prominent players within the housing industry are working to understand how changes within our homes can have a positive, or at least less negative, impact on climate. Earlier this year, the NAR released its inaugural ESG+R Sustainability Report. Redfin’s CEO is passionate about getting homeowners to think about how climate change will affect their current and future living states and how they can be part of the solution instead of part of the problem.

Paying attention to the materials we use in our homes and improving (rather than tearing down) existing homes are two key ways to offset housing’s environmental impact.

Shifting consumer behavior 

While consumer behavior isn’t a symptom of the housing market, it certainly has tremendous effects on the housing industry. In its 2022 Consumer Trends report, Mintel highlighted consumers’ desires for a sense of control, flexible spaces, and ways to mitigate their environmental impact. We’ve touched on environmental impact, and now, we’ll explore how desire for control and flexible spaces impact the housing industry.

A sense of control 

Flexible spaces

People across the country (and the world) are adjusting to a new way of life at home. Homeowners and buyers are looking for spaces to fit their individual needs—from working to practicing yoga. This means that, when selling, staging the extra space in the living room, den, and any other flexible spaces, will highlight how the home will fit buyers’ needs.

The solutions – tools to help agents, buyers, and sellers

There are a lot of challenges that players within the real estate market will face this spring, with the primary being inventory. Unfortunately, no magic button will help us instantly renovate old housing stock, build new homes, and solve for housing affordability. Luckily, millions of dollars have been poured into the PropTech industry to develop solutions for the trends and challenges we face today:

• How can sellers be sure they’ll find the right home to move into after selling their current?
• How can buyers compete as they face another, likely grueling, seller’s market?
• How can we better meet the demands of today’s buyers?
• How can agents compete to win listings with inventory remaining low?

Let’s explore some of the solutions that have been developed to help solve for these questions and challenges.

Concierge Programs

Real estate concierge is generally understood to be a pre-listing service which helps sellers get their homes ready for market. Concierge programs usually include financial assistance for some level of home improvement or staging to help properties appeal to a broad set of buyers and sell for a higher price.

For Agents: Pre-sale repairs and renovations aren’t a novel concept. Agents have been advising sellers on ways to update their homes to better appeal to buyers for decades. Historically, agents have faced hesitance toward pre-listing updates from sellers due to lack of time to complete improvement projects, heightened stress from DIYing or managing a series of contractors, and hesitance due to cash availability.

When agents work with Curbio, each of these hindrances (and more) are addressed to provide a seamless way for agents and their clients to get listings market ready. Our pre-sale home improvement model makes it possible for any seller to take on any repairs and renovations necessary to achieve their home sale goals. We’ve streamlined the process with quick estimates, immediate availability of best-in-class contractors, and high-quality, popular materials to ensure you can get to market as quickly as possible.

For Sellers: The spirit behind concierge programs is to provide a solution for sellers to prep their homes for market, and the benefits are clear. With Curbio, real estate moves faster. We’ve strengthened our project management with user-friendly tech and our Home Improvement Consultants focus on home improvements that add value for buyers. This helps us to complete projects faster than the average general contractor and complete updates that result in fewer days on the market.

For Buyers: Photos provide a lot of information but don’t always give buyers a sense of the home’s layout. Online listings play a significant role in the home search process, and 3D tours make narrowing in on the right home, without wasting time on countless visits, easy.  

For Sellers: 3D tours not only help elevate listings and attract more buyers, they also decrease the number of non-serious buyers requesting showings.