Housing market predictions for buyers, sellers, renters, and new construction in 2022
Undoubtedly 2021 was a hot year for the housing market, but will 2022 be the same? Let see what economists are predicting in the real estate market in 2022.
In 2022, expect interest rates to rise somewhat – but that doesn’t mean they’ll skyrocket. The Federal Reserve has signaled intent to raise interest rates during the year to combat inflation.
While an increase in mortgage interest rates could squeeze out the homebuyers who are on the cusp of being able to afford a home purchase, interest rates will likely remain low compared to historic mortgage interest rates, like the 18.63% average in October 1981.
Additionally, interest rates won’t rise in a vacuum. “It’s important to note that the same thing contributing to an increase in mortgage rates … leads to an increase in wages,” says Odeta Kushi, deputy chief economist for First American Financial Corporation, which provides title insurance and risk solutions services for real estate transactions. Other economic factors will likely come into play that can help assuage affordability issues for many homebuyers. Click here to read more on housing market predictions for 2022 at The Wall Street Journal.