Experts Predict What The Housing Market Will Look Like In 2022
23 min readThe pandemic ignited a home-buying frenzy as the decade-long housing shortage converged with historically-low mortgage rates, shifting workplace dynamics and new opportunities for young buyers to pursue their first homes. As we near the end of 2021, here’s a look at the expectations of real estate experts for 2022.
Danielle Hale, Realtor.com chief economist: We expect a whirlwind 2022 for the housing market. Home sales are expected to increase another 6.6% and home prices to rise another 2.9% on top of 2021 highs. A gradual uptick in mortgage rates will make affordability a top consideration for home buyers, especially the 45 million Millennials aged 26 to 35 who are at prime first-time home buyer age. Demand from these young households will keep the market competitive and fast-paced despite a small uptick in housing inventory as builders continue to ramp production, increasing single-family starts by 5% in 2022.
Although affordability challenges will come from rising prices and mortgage rates, rising rents, which are projected to increase 7.1% will be a strong motivator for many hopeful first-time buyers. On top of this, all home shoppers will have some advantages that stem from a competitive jobs market. Incomes are projected to increase by 3.3% and with many employers looking to attract and retain talent without impacting costs, we expect workplace flexibility will continue. This should free-up potential home buyers to broaden their search parameters to include the suburbs and in some cases even completely new, less pricey metro areas.
This means we expect the suburbs and markets that offer good real estate value to continue to attract an outsized share of attention. While this has reduced the relative affordability of many such areas, they still offer a lower price per square foot and thus opportunity for buyers. On the whole, the housing market will remain competitive, but buyers will have new ways to confront these challenges.
Bob Pinnegar, president and CEO of the National Apartment Association: Housing affordability will remain a key issue as the nation’s rental housing market tries to stabilize from lingering pandemic and housing stock issues. Supply chain delays and continued inflation will also impact every facet of the industry, from property managers to renters to owners.
While the pandemic brought an increased focus on housing affordability at the national level, affordability has been a key concern throughout the industry for years and will continue to be an area of focus in 2022. Demand for apartment and single-family homes continues to outpace supply, which ultimately drives competition and hurts housing affordability. Attention throughout the industry and at all levels of government will be focused on remedies to provide quality and affordable housing.
It’s also likely that we’ll see increased regulatory efforts directed at the rental housing market after a tumultuous time during the pandemic. Though highly disputed by economists nationwide, rent control policies are gaining steam and will continue to be pushed as a quick solution under the guise of preserving affordable housing. Other industry regulations are also being examined, fueled by the expiration of pandemic-induced eviction moratoria. These policies must be watched closely, as they achieve the opposite of the intended effect, driving up housing costs as available housing units leave the market and competition increases.
Brent Fielder, executive vice president of Proper Title: We expect to see incremental growth in housing sales in 2022, but a significant drop in refinancing activity as interest rates rise. The real estate-owned (REO) market—also called lender-owned property—will increase as Covid mortgage bailouts expire.
The home buying experience will proceed with its digital transformation as the real estate brokerage and title industries continue to embrace technology. Electronic options for closings and sales opportunities will become more commonplace for everyday use, which meets the demands of Gen Z and Millennial home buyers. Top priorities for real estate agents and attorneys will be establishing strong customer connections for referral transactions and staying on top of evolving market and industry trends.
Lawrence Yun, chief economist for the National Association of Realtors: Mortgage rates will drift higher as the Fed scales back the purchase of the mortgage-backed securities and raises short-term interest rates, which are likely to hit 3.7% by the year-end 2022 on a 30-year rate after hovering at 3% for most of 2021.
Home sales will notch lower by 2% in 2022, principally because of higher mortgage rates. Home sales will not crash thanks to job gains, investor demand and the work-from-home reshuffle in residential location choice.
Inventory will finally increase due to more home construction, the ending of the mortgage forbearance program and the rise in Covid-related deaths among the elderly. Softer housing demand with more supply will calm the home price growth. Home prices will only rise 3% to 5% nationally.
Skylar Olsen, principal economist for Tomo: Housing in 2022 should be calmer, but don’t expect the full return to sanity. Anyone who explored buying or selling a home this shopping season experienced something intense. We just didn’t know how hot housing markets could get until new record lows on interest rates moved up first-time buyer timelines.
With many parents pulling out their equity to get down payments for their adult children or second home buyers using up portfolio collateral to buy homes away from struggling urban cores, and investors rushing in to diversify portfolios away from over-valued stock markets and capitalize on the potential long-run demand shift that of remote work might bring, the housing market has been anything but typical or normal.
So what will be different about next year? Well, investor buyers are fast, early movers and interest rates should start to rise. Both these things imply some pressure could come off. The urgency to buy now for the financial opportunity of historically low rates or the arbitrage opportunity from remote work will be less. However, there will still be plenty of buyers hoping to hit life’s milestones in a new home.
The pre-pandemic fundamentals were indicative of a demographic wave crashing onto too few homes. The majority of forecasts expect home prices to continue to rise next year, and we agree. Housing will be slower, but only compared to the fastest market in history.
Tom Rossiter, CEO of RESAAS: Prior to Covid, using technology was seen by many real estate agents as a “nice to have.” Now it’s simply a requirement to do business. We expect real estate technology to further evolve in 2022, and for both sellers and buyers to use digital tools even more during the entire home-buying process – from listing to interacting with agents to closing deals.
Patterns we are observing from our exclusive real estate data show us that heightened buyer migration is still not over. The Great Relocation of 2020, where people realized remote work unlocked where they call home, set new records. We are still seeing elevated levels of referrals for buyers looking to move out of state and predict this will continue into the new year as well.
Robert Dietz, senior vice president and chief economist for the National Association of Home Builders. With housing demand solid and existing home inventory too low, home construction should continue at a strong pace in 2022, according to NAHB forecasts. Single-family builder confidence at the end of 2021 is high, registering a level of 83 on the NAHB/Wells Fargo Housing Market Index. We expect a slower growth rate for home building in 2022, but the level of single-family housing starts will be about 25% higher than it was in 2019, pre-Covid.
Nonetheless, supply-side headwinds are limiting the pace of construction and increasing costs. In particular, ongoing supply-chain challenges, insufficient lumber production, higher lumber tariffs and delays for deliveries of just about all types of building materials have frustrated builders and buyers. Construction costs are up 19% year-over-year. In 2022, some of these supply-chain issues will ease, but the skilled labor shortage will grow worse. The construction industry needs to add 740,000 workers a year to account for industry growth and yearly retirements from the sector per a new NAHB estimate for the Home Builders Institute.
Higher construction costs and an expectation of rising interest rates, as the Federal Reserve tightens monetary policy on inflation concerns, will result in additional declines for housing affordability. Policymakers should act to reduce the cost of land development and home construction. Communities that successfully do so will win the competition for population growth and business expansion.
Additionally, multifamily construction should continue to expand, given ongoing growth in rents. Suburban apartment construction in 2020 and much of 2021 made up for some weakness in urban core areas, but now most geographies are seeing gains for multifamily development. In addition, the single-family built-for-rent segment should continue to expand after experiencing the best quarter on record during the third quarter of 2021. And given wealth gains for homeowners due to rising home values, the remodeling sector will realize strong growth in 2022 as homeowners seek to add space, improve energy efficiency and increase resiliency of an aging existing housing stock.
M. Ryan Gorman, CEO of Coldwell Banker Real Estate: Fundamental demand from home buyers remains strong as Americans continue to dream of homeownership, and those dreams may be more likely to become reality due to partial remote work widening search areas to positively impact affordability, even with price increases.
In addition, during the tail end of 2021, foreign buyer and investor interest in U.S. real estate and mortgage assets was heightened. If that continues, demand could escalate further, hopefully coaxing more existing inventory onto the market, though new construction will likely continue to face supply chain delays. As funds from around the world seek safe, stable and valuable investment opportunities, U.S. real estate remains among the most attractive and largest asset classes for investors and families alike. With continuation of these trends, the seller’s market that we’ve seen this year may continue into 2022.
Carla Ferreira, director of onsite development and principal at The Aurora Highlands: We anticipate a strong 2022 for the Colorado market as lot availability widens, the economy stabilizes further and more product is offered. Home sales should increase as buyers are feeling urgency with expected interest rate increases coupled with rising prices in 2022.
The trend of Millennials moving to the suburbs will continue as will the moderate increase in new home prices. Homeowners are looking towards master-planned communities that offer home buyers amenities, room to grow and home offices.
Approximately 75% of new home starts are currently larger communities. We do anticipate a 10% to 12% increase for starts and closing, however there will continue to be a lag in closing times due to supplier and labor challenges.
Laura Ellis, president of residential sales and executive vice president of Chicago-based Baird & Warner: Underlying fundamentals point to another robust year in 2022 with inventory as the wild card. Competitive bids are already slowing down so that may entice many potential buyers who avoided entering the market last year because they were intimidated by multiple offer situations.
If low inventory persists, it could be a market spoiler. As of November 2021, the number of active listings was down nationally more than 55% compared to November 2019 and will continue to be the most significant limiting factor. There’s a lot of pent-up demand from buyers, but sellers will continue to be hesitant in listing their property if they aren’t confident about finding – and closing – on their next home.
Oisin Hanrahan, CEO of Angi: In 2021, we saw a significant shift in the way people think about their homes. The value of home has a new meaning, shifting from thinking about our homes first for its fiscal value or as an investment, to now where our home’s many uses are the primary focus.
For the second year, homeowners have told us that their main reason for taking on projects around the home is to better meet their needs. Before the pandemic, return on investment was the primary motivation. This is a huge shift and something we know will continue throughout 2022, especially as people continue to spend more time at home. As these trends play out further and projects that were put on hold due to Covid disruptions resume, we’ll see the demand for home projects increase to meet the newfound time and focus on the home.
We also continued to see Millennials step into homeownership. As the first digital native home-buying cohort, they expect solutions on demand, on their phones and a simple, easy experience. Their expectations will shape and impact home services in the year ahead, including a strong desire for end-to-end services that align with consumer expectations.
Frank Nothaft, chief economist for CoreLogic: With the Federal Reserve gradually tapering its supportive monetary policy, look for 30-year mortgage rates to average about one-half of a percentage point higher in 2022, or about 3.4%. We expect to see a moderation in buyer demand as the erosion in affordability takes a toll and additional for-sale inventory comes on the market.
With more supply from new construction and existing owners relocating, home sales are expected to rise to the largest number since 2006. With less demand, we expect homes listed for sale will be on the market a bit longer with fewer competing bidders, which should moderate price growth. The CoreLogic Home Price Index Forecast has the annual average rise in the national index slowing from 15% in 2021 to 7% in 2022. Similarly, rent growth on single-family homes reached the highest ever recorded in the CoreLogic Single-Family Rent Index in 2021 and is projected to slow as additional rentals enter the market.
While we expect home-purchase originations to rise, the higher mortgage rates will reduce refinance originations and alter its composition. Refinance originations will likely have a much larger cash-out share in 2022 with slightly lower average credit scores and lengthening of the average loan term. Employment and income growth should continue to keep new delinquencies at a very low level. But the end of foreclosure moratoria and the CARES Act forbearance program will likely result in an uptick in distressed sales in 2022, but this increase will be small.
2022 should be a strong year for housing. Look for mortgage rates to rise but remain historically very low, home sales to grow to a 16-year high, price and rent growth to slow, refinance to shift toward cash-out and delinquency rates to remain low albeit with an uptick in distressed sales.
Matthew Vernon, retail and centralized lending executive for Bank of America: Prices throughout 2021 have risen substantially, and competition has been hotter than ever given the low supply of homes. At the same time, rent prices have sped past projected estimates based on pre-pandemic trends, making homeownership and steady monthly mortgage payments even more attractive, particularly for Millennial buyers.
This demographic is in its peak home-buying years and 52% of younger generations say the importance of building equity has become more important recently. We expect to see a continued increase in home-buying interest and competition while mortgage rates remain low. We’ll also see some homeowners wanting to trade up to larger homes. As the Federal Reserve may raise interest rates next year, those already in the position to look into larger homes will aim to tap into lower rates while they can next year.
Jeff Benach, principal of Chicago-based Lexington Homes: Overall, the housing market should stay pretty hot through 2022, including markets like Chicago. As of now, all indicators point that sales will likely continue at a fast clip until the supply chain issues settle down and until we get completely past Covid-19, both of which should occur in 2022 when the pandemic will be considered behind us by most people. Inflation often helps housing, and it certainly doesn’t seem to have hurt it so far. As for new-home sales specifically, expect to see the continuation of Millennials as the demographic leading the charge in 2022.
Home designs will also continue to be influenced by the pandemic – likely well beyond 2022 – as buyers demand more from their homes, such as multiple offices or remote work/study spaces and multifunctional kitchens that can do it all.
Ben Miller, co-founder and CEO of Fundrise: Some pundits, alarmed by slowing sales in the fourth quarter, are forecasting doom for the residential real estate market next year. But the doomsayers miss a key point: seasonality. Historically, housing prices regularly move almost 7% to 8% between the lows of winter and the highs of spring. Yet every winter, outsiders mistake seasonal swing for secular decline. We expect to see housing prices surge in spring 2022. And beyond that, we expect continuing strength in the single-family rental market, which has soared over the past 18 months.
More crucial to the expected surge in home prices: the excess positive pressure on the economy. The U.S. annual inflation rate is above 6%. Unemployment claims are at their lowest in 52 years. Interest rates are still at historic lows. At least $1 trillion and as much as $3 trillion of fiscal stimulus is underway. And, according to Moody’s Analytics, Americans have $2.5 trillion in overall excess savings from the pandemic era. That buys a lot of houses. So, buckle up.
Susan Wachter, the Albert Sussman professor of real estate at The Wharton School of the University of Pennsylvania: After a year of home prices rising at a blistering 18% rate, housing prices are expected to decelerate to single-digit rates across major metropolitan markets. Fed actions to contain inflation, now running at a 40-year high, will cause, in the consensus forecast, a small (0.5%) uptick in mortgage rates in 2021. This will moderate demand.
If inflation persists or heats up further, a liquidity retreat and a negative tail event with an interest rate spike are possible, although not likely, for 2022. The likely outcome is that 2022 will be a banner year for housing, with single-family starts at over 1 million, and easing inventory constraints. Nonetheless, demand and supply imbalances will persist and high construction costs, due to persistent labor, materials and land shortages, will generate increases in home prices, although at lower rates than in 2021.
Population mobility will remain low, but expect continued movement to lower-cost metros with outdoor amenities and employment growth. Texas, Florida, Arizona and North Carolina will continue to outpace the nation in new home sales.
For the nation as a whole, expect homeownership headwinds. As Millennials, who are in their prime home-buying years, postpone homeownership, multifamily demand and rents will rise, adding to a challenging economy of scarcity, even amid strong economic growth and the prospect of a pandemic recovery.
Dawn Pfaff, president and founder of My State MLS: We are forecasting that prices will continue to rise in 2022 but at a more moderate pace than 2021. Going into 2022, demand won’t be as high, and supply is going to be a bit better than 2021. Mortgage rates will grow but still be a reasonable value for home buyers. Inventory of available properties will remain low, but home builders are ramping up, and many sellers are itching to sell at their new higher prices.
We expect rents to outpace home price growth because demand is still greater than supply. First-time home buyers will continue to struggle because of higher prices and the supply problem. Bottomline, 2022 is still going to be a seller’s market, just not as frenetic as 2021.
Sean Grzebin, head of consumer originations, Chase Home Lending: According to a recent survey of first-time home buyers that Chase conducted this year, 60% said they were likely to buy their home in the next year, and 70% have already made lifestyle changes in order to work toward achieving that goal. This shows us that Americans continue to aspire for homeownership, that they still view home buying as a smart decision for building wealth, and as we head into 2022, that they’re serious about reaching their goals to own a home.
Additionally, the latest generation of buyers will be more diverse than ever before. According to a 2021 report by the Urban Institute, net growth in the number of homeowners in the next 20 years will be entirely among people of color, especially Hispanic homeowners. Between 2020 and 2040, there will be 6.9 million net new homeowner households, a 9% increase. Hispanic homeowners are expected to grow by 4.8 million and Black homeowners by 1.2 million.
Despite home-buying optimism, there are still barriers that exist to prevent people—particularly Black and Latin/Hispanic communities—from accessing and sustaining homeownership. Many of these families may be home buyer-ready today, but the challenge is making sure they know that—and ensuring that we have the home financing products and services that fit the needs of this new set of home buyers.
One of the new ways Chase is helping to educate home buyers is through our Beginner to Buyer podcast launched this year. The podcast aims to break down barriers to homeownership by hosting real conversations with real people, helping to answer the questions you always wondered, but were maybe too afraid to ask.
Sean Black, co-founder and CEO of Knock: Home shoppers who put off their plans to buy in 2021 will have the benefit of more inventory as remote work provides the flexibility to live farther from the office and sellers continue to come off the sidelines. Rising home prices will combine with higher interest rates, making affordability more of a challenge, especially for first-time home buyers struggling to come up with a down payment.
The good news for consumers is that the focus on simplifying the real estate transaction will continue to gain steam. In the future, buying and selling homes will be more like renting an Airbnb with the upside of building equity rather than the complicated, painstaking process it is today.
Kevin Quinn, senior vice president of retail lending at First Internet Bank: If the past 12 months have taught us anything, it’s impossible to predict the future. This past year was a challenging one for home buyers, resulting from a mix of low rates, fierce bidding wars and limited inventory. But I believe we may start to see the market normalize to a degree in the coming year. Mortgage rates and home prices will continue to uptick, but not at record rates. However, if inflation continues, we may see the Federal Reserve begin to increase mortgage rates, impacting prospective buyers.
Jacob Channel, senior economic analyst for LendingTree: Barring a major resurgence of Covid-19, we expect higher mortgage rates as well as a boost in new construction driven by improvements made in global supply chains to result in a somewhat calmer housing market in 2022. While home prices aren’t showing signs of a significant decline, price growth likely won’t be as drastic as it has been since the start of the pandemic. Instead, the double-digit, year-over-year, growth that we’ve seen in many parts of the country through 2020 and 2021, will be replaced with more manageable single-digit growth.
For buyers, higher rates which are on track to end up somewhere near 4% by the end of the year — may be a cause for concern, but it isn’t all bad news. In fact, with less competition and more housing available, some buyers may have an easier time navigating the housing market, even if they’re paying more for a loan.
From a homeowner’s perspective, selling a house in 2022 might prove to be a bit more of a challenge than in the past two years, but even so, the average homeowner shouldn’t expect to be underwater on a home they can’t get off of their hands.
Ultimately, even if the housing market isn’t as hot in 2022, it’s unlikely to crash anytime soon. As a result, both new buyers and current homeowners shouldn’t worry too much about what the new year holds in store.
Patrick Boyaggi, CEO of Own Up: Covid-19 remains a wild card, and the uncertainty it causes will likely put the housing market into flux in ways we can’t expect. Here’s what we do know: Rates are at an all-time low, which heavily increased buying power in 2021. I anticipate that rates will rise in 2022, but it won’t be enough to meaningfully slow down the purchase market. More likely, the rise in prices due to the supply and demand imbalance will have a bigger impact than rising rates will.
When homes become too expensive, consumers are either priced out or more inclined to hold back until the market levels out. This will limit the total purchase market. Until then, we expect to see an increase in the prevalence of all-cash offers, especially in highly competitive markets.
Given that the highly competitive housing market is here to stay, at least into the first half of 2022, it’s increasingly important for consumers to shop around for their mortgage. The average range for a loan scenario is about 0.5% for every borrower–that’s the difference of 30k over the course of the loan for the average homebuyer. Even if rates rise slightly in 2022, shopping around can significantly increase a prospective homebuyer’s chances that they’ll receive the lowest rate out there.
Milford Adams, Denver Metro Association of Realtors 2022 chairman of the board of directors: 2022 will continue to be an indisputable seller’s market around the nation with higher appraisal gaps as supply chain will continue to be a major issue that the world has to combat. We’re hearing reports that we need 100 million homes to stabilize the market and, frankly, that’s not going to happen anytime soon.
In fact, here in Denver, we’re suspecting that the market will stay this way longer than the three years originally predicted, but closer to five years before we see any stability nationwide. Expect to see people getting certifications to move into their homes despite the fact they may not have cabinets for six months or a garage door as it sits on the dock somewhere dwindling with supply chain disruption. As buyers get out there in a world where inventory remains short, they need to be persistent, be patient and have a plan.
Steve Hart, CEO of Property Management Inc.: With the hot real estate market in 2021, we saw several investment property owners selling or liquidating their investment portfolios. They want to sell when the market is high. It’s still a hot market right now because the mortgage rates are low, and there are a lot of people buying. In 2022, I predict it will level out and become more of a normalized market. But even though it will slow down, it’s not going to stop.
The market will still be strong, but the hot pace of sales will slow down, which should increase the number of homes on the market. When that number of homes on the market increases, we won’t see the bidding wars or craziness that we’ve seen in the last year or two. There will still be a high demand for homes on the market, and pricing will still continue to grow, just not at the same rates that it has been.
Todd Teta, chief product officer of ATTOM: Among the many key forces that drive the housing market, it’s reasonable to predict that home prices will keep going up by small amounts over the rest of this year and into early 2022. While things usually slow down in the fall and winter, with interest rates still super low and no sign of demand dropping off amid a tight supply of homes for sale, upward pressure on prices is likely to continue for the short term. Prices have spiked this year by double-digit rates every quarter, so it would take a significant change to reverse that course.
Beyond that, there are many questions hanging over the market, including the path of interest rates, the stock market, the pandemic and the economy, as well as the continued willingness of home buyers to keep paying soaring prices. If things keep going as they are, prices should continue to rise, especially with interest rates so low and the stock market providing the resources for hefty down payments. But if we get another Covid wave—it looks like that’s starting to happen—and the number of households unscathed by the pandemic wave taps out, or the stock market falls from its record highs, that could certainly tamp things down.
Other factors that come into play include inflation, price affordability and foreclosures. Home affordability has worsened recently and foreclosures are on the rise now that lenders are again free to go after homeowners far behind on mortgage payments. Major ownership costs on the typical home nationwide still consume just 25% of the average wage, but are pushing closer to the 28% level that lenders often use as a benchmark for giving mortgages. And, with foreclosure activity up in November by 94% from a year earlier, further increases could lead to a flood of empty homes on the market, which would raise supply and lessen the bidding wars we are seeing throughout the country.
Ann Gray, newly elected president of RICS: While there was a lot of residential market disruption in 2021, it didn’t appear to have affected values or new starts in urban markets. The sector stabilized quickly and is poised to continue its momentum in 2022, based on what we’re seeing from investors, buyers and our professionals. Our numbers are showing that investors and capital providers are very optimistic at least through Q2. They’re also telling us now is a good time to have property to sell, with the overall economic recovery still in a sharp upturn and demand expected to stay high.
The housing shortage, exacerbated by high barriers to entry, is likely to benefit from enthusiasm across the board from sellers and lenders, but especially from investors. Fast-growing Sun Belt and Mountain West cities like Phoenix, Denver and Austin are showing huge demand from young buyers and renters pursuing jobs at relocated tech and service sector employers. The single-family rental market will also continue to see activity for the same reason, as younger families make quality-of-life decisions. 2022 will see continued high volumes of activity along with new starts in non-housing sectors that support population growth.
David R. O’Reilly, CEO of The Howard Hughes Corporation: Over half of people in the United States will consider moving in the next two years as people continue to prioritize time with family, cost and quality of living and a desire for safe and clean neighborhoods.
Businesses will increasingly follow today’s educated workforce as they migrate out of the major metropolitan areas and establish their presence in the smaller cities and communities that exemplify today’s new urban ideal—the best of an amenity-rich, walkable urban environment integrated into expansive natural settings to provide the best of both worlds.
As the migration continues, we will see issues of affordable housing and traffic will garner even more focus as people consider where and how they want to live. We predict that in 2022, Millennials and the transient labor force will demand even greater options for housing and community connectivity to meet the exponentially growing demand.
Jeff Allen, president of CubiCasa: The supply of homes available for sale will remain extremely limited in 2022 compared to historical standards, which means houses will continue to go under contract quickly and at strong prices. We shouldn’t expect another year of 20+% home price appreciation by any means, but supply and demand dynamics will continue to tilt in favor of the seller for now.
Don’t expect a massive home price correction downwards in the near future. First-time home buyers will still face headwinds as higher prices lead to higher down payment requirements, and fast bidding wars during the listing process.
The process to get a home under contract may be fast, but unfortunately the process of closing a purchase mortgage still takes entirely too long, driven largely by the lengthy, expensive and uncertain appraisal process. The FHFA’s announcement that they’ll be starting to offer consumers the much faster and frictionless Desktop Appraisal on GSE loans in early 2022 will be an important turning point in appraisal modernization. And it should drive exciting new efforts to collect robust property data upfront in the listing process, in order to facilitate a smoother buying experience on the mortgage side.
Gary Feldman, founder of the Gary Feldman Group at Aspen Snowmass Sotheby’s International Realty: In 2022, Aspen real estate will see unprecedented demand combined with shrinking inventory, especially at the luxury end of the market. Sellers will continue to expect high sale prices, and will likely see record sales. Buyers will continue to pay historically high prices as opportunities become scarce.
Market-wide, we’ll continue to see the price per square foot increase breaching the $4,000 price per square foot level for truly special properties. In the past year, 75 single-family homes sold for more than $10 million in Aspen, whereas only 17 single-family homes are currently listed for over $10 million. As inventory dwindles, days on market will continue to shorten with many deals being struck prior to listing in the MLS.
Ryan McLaughlin, CEO of the Northern Virginia Association of Realtors: Next year will again be big and almost as boisterous as 2021. We expect to see home sales continuing to grow in Northern Virginia with demand exceeding supply. Based on what we saw this year, we know that even with typical seasonal fluctuations, the market outpaced five-year averages with sales and listings.
In 2022, we expect home prices in the NVAR region—right outside the nation’s capital—will rise, but at a more moderate pace than seen in the past 12 to 18 months. The 2022 market may be a bit cooler than 2021 but will still be a strong year for Realtors and their clients.
By year end, we will not be surprised with mortgage rates pushing the 4% mark – still well below historical patterns but possibly edging some potential buyers out of the market. However, the recent announcement by the FHFA raising the GSE conforming loan limits will help offset mortgage rate increases.
Judy Zeder, real estate agent with The Jills Zeder Group at Coldwell Banker Realty: I’m bullish on real estate for 2022. With all the changes and disruption in almost every market area, from supply issues and challenges in the hospitality and service businesses, to volatility in securities markets and cryptocurrency, the one constant in growth and stability has been in real estate.
Changes caused by the pandemic and its residual impact on the workplace prompted pivotal decisions by CEOs and executives to move their businesses and their personal residences to South Florida. The drivers of those decisions included no state or local income tax, no estate tax, good homestead laws and overall desirability of the area. Those factors remain constant, are still attractive from both a personal and business standpoint, and support a positive outlook on real estate in South Florida.
