Columbus Housing Market Expected to Grow Stronger, With High Demand

On Mar 21, 2022

Listing service Realtor.com predicts that Central Ohio will be the nation’s fifth-hottest market this year, with home sales and prices likely to rise twice as fast as the national rates.

Certainly, the area already has a strong track record that should only grow stronger in the coming year. The Columbus area has been in the top 20 percent nationally for real estate appreciation in the last decade, says California-based Norada Real Estate Investments.

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Because demand remains extraordinary and inventory relatively low, it’s still a seller’s advantage in early 2022. Buyers might be tempted to take a wait-and-see approach this year due to the continuing parade of COVID variants, an economy potentially weakened by inflation and persistent increases in local housing prices.

Experts advise jumping into the search, though. Realtors say the uncertainty of COVID clouds the year and will impact the market directly and indirectly, influencing supply chain, materials, labor force and the behavior of people looking to sell or buy homes.

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Either way, Columbus Realtors president Sue Van Woerkom says would-be buyers should remember that inventory remains tight and sellers continue to get multiple offers, though there may not be as many as a year ago. Beware, too, that inflation could easily drive up interest rates, which hovered just above 3 percent at the end of the year.

“The feds are easing economic prop-ups and that could change house payments and decrease affordability,” Van Woerkom says. “We have never experienced a market like this and there are no bargains. Buyers will do anything including selling their grandmother to buy a house.”

Contributing to a tightening market are maturing millennials looking to become new homeowners. They will represent a large wave of potential buyers this year, Jones says.

“Ten to 12 years ago millennials said they didn’t want to own a home, but they have been some of the biggest drivers in buyer’s demand,” he says. “I had millennial buyers enter the market in the spring who couldn’t get a house, so they made the decision to rent another year.”

Looking back at 2021, the trend that sellers were capturing more money from a buyer over the original list price a year ago cooled somewhat by year’s end.

“Price adjustments were made to just under 15 percent of homes [in August] compared to 27.2 percent of homes in January [2021],” writes Norada founder Marco Santarelli in his September blog.

Michael Jones, past president of the Columbus Board of Realtors, says buyers at the beginning of 2021 may have paid up to 5 percent more for a home than the asking price. But by the latter part of the year, sellers made downward adjustments in price.

“People entered the market with pie-in-the-sky pricing later [in the year] and the market responded by saying, ‘Not quite there,’” Jones says. “A trend we want to watch for in 2022 is to see if people price their homes for truly what they’re worth, not what they hope the market might bring.”

In the end, the only certainty for the year ahead is the area’s affordability and steady demand for homes, giving a leg up to sellers.

This story is from the February 2022 issue of Columbus Monthly.