2021 was, to say the least, an interesting year in real estate. But as the year comes to a close, the big question on everyone’s mind is what does 2022 have in store?
A recent article from realtor.com outlined some of their economists’ predictions for the 2022 housing market, including:
Home prices will stay high—but price growth will slow down. Home prices rose high and fast in 2021, with realtor.com economists predicting a 12 percent rise for 2021. And while the realtor.com team predicts that home prices will stay high, they also see that growth slowing down—with price growth projected at a much slower rate of 2.9 percent for 2022.
Inventory challenges will continue. Low inventory proved a huge challenge for buyers in 2021; fewer homes on the market meant higher competition and higher prices—and it looks like it is going to stay that way in 2022. The economists at realtor.com only expect the number of homes available to increase by 0.3 percent in the coming year.
Mortgage rates will rise. Mortgage rates have been hovering near all-time lows throughout the year, creating even more demand for housing. But buyers hoping to score the lowest possible rate on their mortgage should act fast; the economists at realtor.com predict mortgage rates to hit 3.6 percent by the end of 2022—a significant increase from 2021’s low of 2.65 percent.