If you’re thinking about buying or selling your home in 2022, you’ll naturally want to know more about how the housing market will look going forward. Well, predicting the state of the market is about as easy as predicting the weather - you can get some ideas about the way things are trending, but you’ll never know what’s going to happen with 100% accuracy.
To get a better idea, however, we can take a look at what real estate experts are saying and pay close attention.
Don’t forget: A housing market forecast can only give you a hint of what to expect if you buy or sell your home in the coming months. Try not to let it rule all your decisions. Those should be based on your personal finances and life events.
That said, it is no doubt an interesting time for the housing market. In 2021, the market exploded with record numbers of homes getting sold month over month. If the previous year is anything to go by, there’s no sign of things slowing down in 2022.
Experts say a big factor in this is a post-pandemic economic rebound. Up until now, mortgage rates have been record breaking low. Job recoveries and higher demand are also playing a part in accelerating this market.
During the final four months of 2021, home sales skyrocketed before dipping slightly in December. Curiously, the December numbers were still higher than in the previous year. At this point in time, we can confidently say there is high demand for homes with a relatively small inventory to go around. Buyers are ready to compete with one another for the best deals.
To help you prepare, here are some expert predictions of how the housing market might turn as 2022 hits its stride:
Housing Market Stats for 2022
Home sales: 6.9 million
Home prices: Up 6.2%
Mortgage rates (30-year fixed): 3.6%
The median home cost rose to just over $346,900 last year—that’s more than $50,000 higher than in 2020!
Some months saw even greater median home price spikes. In December, for example, the median home price was $358,000. This trend ended up continuing into the new year and setting the pace for the market we’re seeing now.
Let’s also not forget how all-time-low interest rates are affecting overall housing costs. Rates can range anywhere from 2.15–2.39% for a 15-year, fixed-rate mortgage or 2.74–3.10% for a 30-year, fixed-rate mortgage.
As it turns out, however, we are already starting to see a steady increase in mortgage rates as we move deeper into 2022. The Federal Reserve has already announced it plans to raise interest rates this year in its efforts to combat inflation. A move like that won’t affect mortgage rates directly, but it will lead to increased rates for all borrowers across multiple markets. Over time, new buyers may end up paying more for their house.
Don’t forget to keep in mind that these numbers will likely change as new trends are analyzed by market experts. Bottom line: Home sales will likely stay strong through 2022. That is, of course, dependent on the overall health of the economy. Let’s just hope the prices don’t rise too fast.
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