PR Newswire
SANTA CLARA, Calif., Dec. 1, 2021
SANTA CLARA, Calif., Dec. 1, 2021 /PRNewswire/ -- Americans will have a better chance to find a home in 2022, but will face a competitive seller's market as first-time buyer demand outmatches the inventory recovery, according to the Realtor.com® 2022 Housing Forecast. Additionally, with listing prices, rents and mortgage rates all expected to climb while incomes rise, 2022 will present a mixed bag of housing affordability challenges and opportunities.
"Whether the pandemic delayed plans or created new opportunities to make a move, Americans are poised for a whirlwind year of home buying in 2022. With more sellers expected to enter the market as buyer competition remains fierce, we anticipate strong home sales growth at a more sustainable pace than in 2021," said Realtor.com® Chief Economist Danielle Hale. "Affordability will increasingly be a challenge as interest rates and prices rise, but remote work may expand search areas and enable younger buyers to find their first homes sooner than they might have otherwise. And with more than 45 million millennials within the prime first-time buying ages of 26-35 heading into 2022, we expect the market to remain competitive."
Realtor.com® forecasts strong 2022 home sales and competition, as first-time buyers overwhelm recovering inventory levels
Realtor.com® forecasts 2022 home sales (+6.6% year-over-year) will hit their highest level in 16 years as buyers remain active and for-sale inventory begins to recover from recent steep declines. 2022 buyers will face a competitive seller's market, with record-high listing prices, fast-paced sales and limited for-sale home options as existing-home listings continue to lag behind pre-COVID levels. The new construction supply gap of 5.2 million new homes may shrink somewhat in 2022 as builders continue to ramp up production with a projected increase of 5% year-over-year.
With prospective sellers planning to increasingly enter the market this winter, Americans can look forward to more opportunities to make a successful home purchase. Affordability will be a growing consideration as mortgage rates and home prices rise, but a growing economy, strong employment market and workplace flexibility will enable more home shoppers to successfully buy their first homes without breaking their budgets. Additionally, with rents forecasted to grow at a faster annual pace (+7.1%) than for-sale home prices (+2.9%) in 2022, homebuying may become the more affordable option, when compared to renting, in many markets. Despite the challenging market, the homeownership rate is expected to grow slightly in 2022 (65.8%).
Metric (National) | 2022 Realtor.com® | 2021 Realtor.com® Housing |
Existing Home Sales | +6.6% year-over-year | 6.0 million |
Existing Home For-Sale Inventory | +0.3% year-over-year | -18% year-over-year |
Existing Home Median Sales Price Appreciation | +2.9% year-over-year | +12% year-over-year |
Rent Growth | +7.1% year-over-year | +8% year-over-year |
Mortgage Rates | 3.3% (avg); 3.6% (year-end) | 3.0% (avg); 3.2% (year-end) |
Single-Family Housing Starts | Up 5% over 2021 | +15% year-over-year |
Homeownership Rate | 65.8% (year-end) | 65.5% (annual average) |
2022 housing trends reflect new homebuying opportunities combined with the past decade of growing challenges
"Our Housing Forecast suggests that we're in store for another dynamic year of activity, but 2022 will also come with growing pains as we navigate the path forward from the height of the pandemic toward a new normal," said George Ratiu, Manager of Economic Research for Realtor.com®. "With most real estate markets expected to be competitive in 2022, it's important to remember that you're in the driver's seat of your real estate journey. The bottom line for buyers is to make sure you're comfortable with your timeline and budget – and especially for younger buyers making this massive financial decision for the first time. For sellers, take into account your local market conditions as well as the likely increase in the number of homes for sale, and price yours competitively. The good news is that sites like Realtor.com® provide more advanced digital real estate tools than ever before, including personalized matching to high-quality real estate agents in your local area, to help you chart the best path forward for you and your family."
Homebuyers can use Realtor.com® tools like its affordability calculator to get a sense of how much they can afford in the 2022 housing market, as well as the Realtor.com® app to set up personalized searches and price alerts on new listings matching their criteria. Additionally, sellers can use Realtor.com® resources like My Home and Seller's Marketplace to explore multiple home valuations, instant offers from Opendoor, the Knock Home Swap™ for those buying a next home at the same time, and more.
Realtor.com® 2022 Housing Forecast – 100 Largest U.S. Metros (in alphabetical order)
Metro | Forecasted 2022 Home | Forecasted 2022 Home |
11.4% | 4.5% | |
-0.9% | 4.0% | |
3.9% | 4.4% | |
4.0% | 4.3% | |
10.0% | 3.5% | |
3.5% | 4.1% | |
4.7% | 3.0% | |
-4.2% | 6.1% | |
-2.4% | 3.2% | |
-1.8% | 1.5% | |
8.1% | 5.6% | |
12.9% | 7.9% | |
3.9% | 7.5% | |
0.7% | 2.5% | |
4.3% | 4.5% | |
-5.6% | 2.7% | |
2.7% | 4.6% | |
9.9% | 5.6% | |
3.7% | 6.9% | |
-2.6% | 1.9% | |
7.9% | 5.4% | |
7.8% | 4.2% | |
10.3% | 5.2% | |
6.4% | 5.1% | |
13.7% | 6.3% | |
8.3% | 4.0% | |
10.7% | 4.3% | |
0.6% | 6.1% | |
6.0% | 5.0% | |
5.9% | 3.9% | |
6.3% | 5.6% | |
8.9% | 4.2% | |
10.6% | 5.1% | |
3.7% | 5.9% | |
6.6% | 7.1% | |
6.6% | 5.3% | |
11.4% | 5.7% | |
4.4% | 3.5% | |
-2.9% | 0.7% | |
2.6% | 2.4% | |
14.8% | 5.5% | |
4.7% | 3.5% | |
6.2% | 6.5% | |
11.0% | 4.7% | |
3.3% | 5.9% | |
6.5% | 7.0% | |
0.1% | 5.9% | |
6.7% | 3.4% | |
-1.6% | 4.8% | |
7.3% | 4.5% | |
6.2% | 3.9% | |
5.9% | 5.1% | |
7.4% | 6.6% | |
3.6% | 5.8% | |
10.5% | 2.4% | |
4.1% | 6.0% | |
5.5% | 5.6% | |
-1.8% | 1.0% | |
0.7% | 5.0% | |
-3.0% | 2.3% | |
0.8% | 1.7% | |
3.7% | 2.6% | |
8.2% | 4.9% | |
8.8% | 5.4% | |
-2.2% | 4.4% | |
7.4% | 7.9% | |
4.7% | 2.9% | |
7.5% | 6.8% | |
8.3% | 3.5% | |
-0.2% | 10.0% | |
6.1% | 4.3% | |
8.1% | 9.5% | |
9.6% | 4.3% | |
5.0% | 4.9% | |
-1.4% | 5.5% | |
8.3% | 4.0% | |
6.0% | 5.0% | |
6.8% | 1.7% | |
15.2% | 8.5% | |
5.1% | 3.5% | |
0.2% | 4.8% | |
-5.2% | 5.5% | |
-4.0% | 4.2% | |
3.6% | 1.1% | |
9.6% | 7.5% | |
12.8% | 7.7% | |
6.1% | 6.6% | |
1.0% | 7.8% | |
5.7% | 4.4% | |
9.6% | 6.8% | |
11.0% | 2.4% | |
8.0% | 6.2% | |
0.8% | 1.8% | |
-3.9% | 0.2% | |
11.8% | 2.7% | |
5.6% | 3.8% | |
7.4% | 6.3% | |
5.9% | 5.8% | |
8.4% | 8.2% | |
7.3% | 6.9% |
Methodology
Realtor.com®'s model-based forecast uses data on the housing market and overall economy to estimate values for these variables in the year ahead.
About Realtor.com®
Realtor.com® makes buying, selling, renting and living in homes easier and more rewarding for everyone. Realtor.com® pioneered the world of digital real estate more than 25 years ago, and today through its website and mobile apps offers a marketplace where people can learn about their options, trust in the transparency of information provided to them, and get services and resources that are personalized to their needs. Using proprietary data science and machine learning technology, Realtor.com® pairs buyers and sellers with local agents in their market, helping take the guesswork out of buying and selling a home. For professionals, Realtor.com® is a trusted provider of consumer connections and branding solutions that help them succeed in today's on-demand world. Realtor.com® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com®.
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SOURCE Realtor.com
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