2022 Real Estate Predictions: What to Expect From the Market
When the COVID-19 outbreak took the world by storm in March 2020, there were many uncertainties. With all the chaos and unknowns, few could have predicted that the pandemic would ultimately spur one of the most competitive and tight housing markets in both U.S. and Canadian history. Between August 2020 and August 2021, home prices across the United States and Canada rose to record levels, with the U.S. housing market rising to a record of 19.9% and the Canadian housing market rising to a record 21.4%.
While these prices have been a home seller's dream, it has also made buying a home much more difficult over the past year and a half. So, what can home sellers and home buyers expect to move in 2022? Will the market continue to rise, stay the same, or finally see a steady decline? Read on to discover more about all the predictions for the 2022 real estate market.
Will the 2022 Real Estate Market Run Bullish or Bearish?
When it comes to predicting markets, you will always have experts on both sides of the discussion. So while some experts are predicting a bullish outlook for the 2022 real estate market where home prices continue to rise, others are predicting a bearish outlook where home prices will start to trend down.
Of course, with home prices hitting record levels of growth, even faster than that experienced in the run-up to the 2008 financial crisis, the current market will not be sustainable forever. However, the question is not if the market will trend down, but when and how fast. Will the real estate market come to a crashing halt in 2022, or will it slow gradually? Check out all the expert predictions regarding the 2022 real estate market below.
Will Home Prices Rise, Fall, or Stay Steady in 2022?
While there are many predictions regarding the 2022 real estate market, the general consensus is that the market will cool off in both the United States and Canada, but not by much. Fannie Mae predicts that the medium home prices will see a rise of around 7.9% between the fourth quarter of 2021 and the fourth quarter of 2022. While this would mark a fall in the current price growth of the market, it would still represent a strong growth by historical standards of the real estate market. Ultimately, Fannie Mae's predictions have the housing market returning to steady levels of price appreciation.
In comparison to Fannie Mae's outlook on the 2022 real estate market, Zillow and Goldman Sachs are forecasting a much more bullish run while CoreLogic has put out a bearish prediction. Zillow has predicted home prices jumping 13.6% and Goldman Sachs even higher with a prediction of 16%. While Zillow and Goldman Sachs are seeing a world where home prices soar in 2022, the real estate data firm CoreLogic is predicting only a small 2.2% home price growth in the coming year.
In Lenawee, we've seen 9% growth across the county between December 2020 and 2021. Additionally, there has been substantial growth in average sales price. In 2020, the average sales price for single-family homes in Lenawee county was $172,458. However, in 2021 we see that number has risen to $205,800. That's a 19% increase over one year.
Ultimately, it looks like the 2022 real estate market will still strongly favor home sellers rather than home buyers. The supply of homes for sale is near record lows, and the gap between supply and demand is only widening. However, with the right real estate agent, finding a new home in 2022 is still certainly possible.