BLOOMINGTON-NORMAL, Ill. (WMBD) — As we quickly approach 2022 the housing market is looking to boom nationally in the next year.
Real estate website, Zillow predicts house prices will rise 11% overall nationally.
In Bloomington-Normal local realtors expect the housing market to stay hot, but with home values rising, now the question is can the twin cities keep up with demand?
“We’re going to have a record-breaking volume– which is the amount of homes sold as well as numbers of units,” said operating principal at Keller Williams Revolution, B.J. Armstrong.
However, a short-supply is driving up the prices of homes in Bloomington.
“We continue to see the lowest inventory we’ve ever seen, down to two weeks or so of inventory in the housing market,” Armstrong said. “I mean literally, we’re less than 200 houses for sale period in McLean County, so when you get to those kind of numbers, we could probably sell 1,000. So right now we have 200 houses to feed 1,000 people and that’s a problem. That’s what is driving our prices.”
Armstrong said it’s thanks to local investments from Rivian and Ferrero as well their continued growth of employment.
“The demand will be there. The buyers will want to buy as many. It’s whether or not the sellers will want to show up this year, but I think that they will,” Armstrong said.
This all comes as the fed announced a rise of interest rates in the coming year mainly due to inflation.
“The last 20 months or so have been basically historic lows for interest rates and nothing stays up or down forever, so it’s not surprising,” said senior loan officer at First State Mortgage, Dave Usiak.
Despite that, Usiak said rates are still lower than they were five years ago and doesn’t believe it will stop homebuyers from buying.
“Anytime you can get an interest rate with a three as the first number, you’re doing pretty well,” Usiak said.
Usiak said no one can predict with any certainty where rates will go, rather it’s an educated guess. He said the trend appears to be looking for them to rise, but many unforeseen events could happen.
Normal Town Council member, Kathleen Lorenz said she is concerned that due to a short supply of housing prices will continue to rise. She’s calling on leaders from the City, Town and county to work with businesses and relators to collaborate on finding a solution.
“If we can help meet that demand, that will help in theory; economic theory, keep prices where they need to be,” Lorenz said.
Lorenz said they also need to address as community stakeholders the lack of affordable housing and rentals in the area. She adds it’s “lost opportunity” that some people are living as far away as Morton to find an apartment.
For homeowners, 2022 looks to be a seller’s market and Armstrong said it will take a “major shift” economically to change that.