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<\/figure>\n\n\n\nWith the 2021 housing market being one for the record books, everyone is wondering what will happen in 2022. <\/p>\n\n\n\n
To figure this out, let’s first try to get a sense of where we are. <\/p>\n\n\n\n
Where Do Things Stand Now?<\/h3>\n\n\n\n
On average, home prices have gained 4.6% every year since 1980. However, home price appreciation in 2021 blew this trend out of the water. Overall price growth in 2021 stood at 19.9%<\/a> \u2014 with a 12-month record set between August 2020 and August 2021. <\/p>\n\n\n\n According to Realtor, the median listing price in January 2022 has climbed to $375,000, up 10% from last year and 25% from January 2020<\/a>, while the median existing-home sales price clocked in at $358,000<\/a>. <\/p>\n\n\n\n The 2022 housing market is currently said to be 3.8 million single-family homes short<\/a> of what is needed to meet demand, with only 1.8 months’ supply<\/a>. <\/p>\n\n\n\n Numerous other factors are also in play as we try to predict what’s going to happen with this year’s housing market \u2014 from the pandemic, to inflation, the economy and more. <\/p>\n\n\n\n Here are a few of the questions we’ve been asking ourselves along with some answers from the experts. <\/p>\n\n\n\n In terms of 2022 home prices, we may be in for another wild year. Every agent seems to have a story about doing gangbusters business in 2021, and at the beginning of the year, most experts didn’t think such things could continue at the same frenzied pace. <\/p>\n\n\n\n Lawrence Yun, chief economist for the National Association of Realtors, told MarketWatch he expected home price growth to return to normalcy<\/a>, with an overall price appreciation of only 5% for the whole year. <\/p>\n\n\n\n The Mortgage Bankers Association actually predicted a 2.5% dip in prices by the fourth quarter<\/a> due to higher borrowing costs and other economic factors. <\/p>\n\n\n\n In a survey of 2022 home price predictions<\/a>, CoreLogic and Redfin predicted very modest growth of 1.9% and 3.1%, respectively, while Fannie Mae and Freddie Mac predicted more robust 7.9% and 7.0% growth, respectively. <\/p>\n\n\n\n Last fall, Goldman Sachs and ZIllow had predicted 13.5% and 13.6% increases<\/a>, respectively, between October 2021 and October 2022. However, Zillow has since decided to revise their prediction, foreseeing a 16.4% spike by December 2022<\/a>, primarily due to a continuing inventory shortage. <\/p>\n\n\n\n It turns out that knowing what home prices are going to do this year is one of the more difficult 2022 housing market predictions to make. <\/p>\n\n\n\n Most experts think prices will continue to rise, but by how much is yet to be determined. <\/p>\n\n\n\t\t Stay organized, stay on track right in your inbox.\n<\/p>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Housing inventory in 2022 may be a little easier to predict than home prices, but the forecast may not be what homebuyers want to hear. <\/p>\n\n\n\n Buyers really got walloped in 2021, with what was said to be the lowest supply of housing in more than 40 years<\/a>. An amazing 72% of homes<\/a> received multiple offers in April 2021 bidding wars, up from 45% back in 2020. <\/p>\n\n\n\n Unfortunately, these supply woes haven’t been fixed since then. Inventory in December 2021 stood at just under 1 million homes<\/a>. That’s down 17.5% from December 2020 and 37.8% from December 2019, when there were nearly 1.7 million homes on the market<\/a>. <\/p>\n\n\n\n Fortune has found that out of 327 real estate markets tracked by Zillow, 254 have inventory down 30% or more<\/a> compared to December 2019. In 54 of these markets, inventory is down by more than 50%. <\/p>\n\n\n\n New construction is also likely to remain low in 2022, inching up only about 0.3% for the year<\/a>. <\/p>\n\n\n\n A seasonally-adjusted estimate of new construction houses for sale at the end of December was 403,000, a modest 6.0 month supply at the current rate of sales<\/a>. <\/p>\n\n\n\n Meanwhile, the inventory of active listings is said to be down 57.1%, compared to 2019<\/a>. <\/p>\n\n\n\n A discussion of housing supply wouldn’t be complete without a look at demand. <\/p>\n\n\n\n A key real estate trend over the last 40 years has been the age at which first-time buyers get their first home. That age is typically around 33 years old, and, as NAR researcher Jessica Lautz points out, a wave of 23.4 million Millennial adults<\/a> are now aging into this specific demographic. <\/p>\n\n\n\n While some first-time buyers are facing setbacks, like pricey homes, stagnant wages and a lingering pandemic, others are in a better position. <\/p>\n\n\n\n A huge number of Millennials moved home during the pandemic, saving on rent and paying down student debt, which may position them to place an offer and close on a home in 2022. <\/p>\n\n\n\n Almost everyone expects mortgage rates to rise in 2022. It’s probably one of the easiest real estate predictions to get right in 2022. In January, Fed Chair Jerome Powell made it clear that federal funds rate hikes were coming<\/a> to try to tame too-high inflation. <\/p>\n\n\n\n Just how many rate hikes real estate professionals should expect in the 2022 housing market is still up for debate, but the spread ranges from two<\/a> to seven or more<\/a>, plus additional increases in 2023. <\/p>\n\n\n\n If and when they happen, those 25 basis-point hikes from the Fed will eventually result in everyone’s rates to inching up, including mortgage lenders. But just the news that rates were likely to rise has already led to a surge in the cost to borrow for a home. <\/p>\n\n\n\n In January, mortgage rates experienced their biggest one-month jump since 2013<\/a>, from an average of 3.11% to 3.64% for 30-year fixed mortgages. <\/p>\n\n\n\n That’s still a great rate for a mortgage, but it is likely to cause a few things to happen in homebuying and selling. <\/p>\n\n\n\n First, buyers on the fence may jump into the market early this year to try to lock down the best rates before they’re gone. <\/p>\n\n\n\n But next, as rates continue to rise, some buyers and sellers may decide to sit things out. That’s because buyers could be priced out and sellers could find it harder to get the price they want for their home as they face these market headwinds. <\/p>\n\n\n\n As for how high mortgage rates are going to go, we’re not talking stratospheric, at least this year. HousingWire’s lead analyst Logan Mohtashami predicts an upper end range in mortgage rates of 3.375%\u20133.625%<\/a>. Bankrate’s chief financial analyst Greg McBride predicts a 2022 high of 3.75%<\/a>. And CoreLogic’s Frank Nothaft predicts an overall average for the year of 3.5%<\/a>. <\/p>\n\n\n\n In a wider context, these are still great mortgage rates \u2014 as Nothaft points out, rates averaged 4.1% for the decade of 2010 through 2019<\/a> \u2014 they’re just not quite as great as the 2.96% average of 2021. <\/p>\n\n\n\t\t A lot of other things are impacting the housing market in 2022. Some parts of the country are still dealing with the pandemic and its fallout. <\/p>\n\n\n\n A Census survey last year showed that 23.5% of households<\/a> had at least one family member working from home and that fact may end up influencing homebuying and selling decisions this year. <\/p>\n\n\n\n NAR’s Jessica Lautz points out that a Realtors Confidence Survey showed 88% of buyers last year chose a suburban, small town or rural area<\/a>. Buyers are finding that space, affordability and inventory is often better in these locales. <\/p>\n\n\n\n Convenience to family and friends has also become the second-most important factor for homebuyers<\/a> according to NAR, showing buyers are thinking more about quality of life issues in their decisions. <\/p>\n\n\n\n Homebuyers are also thinking about the runaway prices of more than their homes. <\/p>\n\n\n\n The most recent Consumer Price Index, a key inflation measure, shows prices are rising at the fastest pace in 40 years, up 7.5% since last year<\/a>. HousingWire notes that hourly wages are also up, but only by about 5% over the last year<\/a>. <\/p>\n\n\n\n These issues, while not directly related to the housing market, are likely to have an impact this year, too, as buyers try to save for a down payment, pay down debt and afford their new mortgage. <\/p>\n\n\n\n As you may have gathered, there’s a lot going on with the 2022 housing market, and we’re only just getting started with homebuying season. <\/p>\n\n\n\n But it is possible to draw some conclusions that may be useful for real estate agents getting ready for another year for the record books. <\/p>\n\n\n\n Real estate agents working with buyers in 2022 have their work cut out for them. But the right approach could help them end the year on a high note. <\/p>\n\n\n\n For agents working with sellers in 2022, there are also many ways to come out ahead when you take the right approach. <\/p>\n\n\n\n For real estate agents looking for how to make the most of the 2022 housing market, try these 10 tips. <\/p>\n\n\n\n We have a few ideas about what might happen in 2022, but a lot is still unknown. <\/p>\n\n\n\n Prices and interest rates are going up, supply is staying low, and demand is staying high. <\/p>\n\n\n\n A bidding war could be on the horizon. Or, buyers could have difficulty finding affordable homes. Or, sellers could want to hold out for even bigger sales prices. <\/p>\n\n\n\n It’s too early to say for sure, but 2022 won’t be boring. <\/p>\n\n\n\n Real estate data and expert analyses can help you make better decisions as a real estate agent. <\/p>\n\n\n\nWill Prices Increase? And by How Much?<\/h3>\n\n\n\n
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\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t#1 Email tool for Real Estate Agents<\/span><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t\n\n\n\nWhat About Inventory and Supply? <\/h3>\n\n\n\n
What’s Going On With Demand?<\/h3>\n\n\n\n
Are Interest Rates Going Up and By How Much?<\/h3>\n\n\n\n
Look Like a Pro,<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
Close Like a Pro<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\tWhat Else Is Impacting the Housing Market?<\/h3>\n\n\n\n
Part 2: Buyer and Seller Analyses for Agents<\/h2>\n\n\n\n
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<\/figure>\n\n\n\nWhen It Comes to Buyers…<\/h3>\n\n\n\n
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When It Comes to Sellers…<\/h3>\n\n\n\n
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Part 3: 10 Tips for Real Estate Agents for 2022<\/h2>\n\n\n\n
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<\/figure>\n\n\n\n1. Prepare for Another Crazy Year<\/h3>\n\n\n\n
2. Stay Tuned Into the Data <\/h3>\n\n\n\n