2021 saw a significant rise in real estate property prices due to an unexpected and rapid rise in home values during the pandemic. People were forced to work from home and others migrated from the cities to less congested towns like the Hamptons. Some believe this was the beginning of the real estate bubble that investors are still trying to predict its timeline.
Many people are now concerned about an impending housing market collapse looming in 2022. With the uncertainty of how long the pandemic will last, it is difficult to precisely predict the real estate future. But based on the current and past trends, it is unlikely that the property market will crash in 2022 because of:
- Lower foreclosures than in the past
- A strong job market
- Rigorous lending standards
- Rising interest rates
- Lessons learned from the previous recession
As the housing boom continues into 2022, real estate experts believe it is bound to flatten later in the year when mortgage interest rates increase. But the shift in the desired housing type brought about by the pandemic remains and more people will look into places such as the Hamptons to meet their housing needs.
Hamptons Real Estate Market
Buying or selling property in the Hamptons has tremendous benefits for both parties because the area fulfills the current lifestyle choices of full-time or hybrid work from home policies. In addition, Hampton’s commercial properties have the feel of luxury with a natural ambiance and its proximity to New York City makes it a prime place in 2022.
The Hamptons saw a rise in property turnover in the listing as more contracts were signed faster in January 2022 than January 2021. Some properties were also sold at a slightly higher price than the asking price.
The ultra-luxury properties in the Hamptons are performing exceptionally well as the wealthy move to purchase magnificent homes outside the busy, congested cities. There has been consistent trading on & off for the ultra-luxury properties and prospects look strong in 2022, which means the same for businesses looking for commercial real estate in our area.
Potential sellers in the Hamptons are generally concerned about the real estate bubble and are unmotivated to list. 2022 will have an abundance of off-market and unofficial listings, and working with a well-connected Hamptons commercial real estate team will help buyers get the property they desire.
Buyers are also hopeful that the property prices will either stabilize or drop as they wait for life to resemble the pre-pandemic period. Ironically, the market prices are bound to remain strong even if demand slightly reduces. The seller’s apprehension to list their property creates a balance that will sustain a strong market.
The pandemic also saw many long-term rental options being sold to end-users and were permanently off the market. These sales have affected Hampton’s summer rental market inventory. Homeowners who rented their homes for months no longer rent out but use the house themselves.
While the demand for property will not be as high in 2022 as in 2021, buyers are still looking to own property in the Hamptons. Real estate agents and brokers continue to receive multiple offers from buyers looking to secure their perfect business space.
Some understand that they may not find one by summer 2022, as they are opting to rent one in the meantime. These dynamics look promising for the commercial properties in the Hamptons, with less likelihood of the real estate bubble to burst.
When Will the Real Estate Bubble Burst?
Probably not in 2022. Real estate experts debate whether there is a real estate bubble to burst or the rapid market growth was due to factors that will remain steady in the future. Key metrics that determine if the housing market will crash have also kept the market elevated. For instance:
- The government assistance programs reduced the foreclosure numbers
- The pandemic’s work from anywhere policy prioritized long-term housing plans
- The shortfall of diverse housing demands that emerged in 2021 and will continue in 2022
The impact from the 2007–2008 great recession remains fresh in investors’ minds casting doubt on the validity of the current housing market boom. But according to the National Associations of Home Builders, the housing market has continued to be supported by buyer interest in suburbs, exurbs and small towns such as those on the East End of Long Island.
The Hamptons qualifies as the perfect location for the rising property demands in these uncertain times. For buyers and sellers to get the best deal in the Hamptons, they have to work with experienced local commercial real estate agents who have connections and understand the actual demand and supply outlook. Talk to us today for the real estate deals in the Hamptons.