The Predictions for 2022 and the Reality
Prediction 1: Mortgage interest rates will rise
It was predicted that mortgage rates would rise in 2022. Lawrence Yun, the chief economist at the National Association of Realtors, thought rates would be around 4% during 2022. The Mortgage Bankers Association said the rate would be approximately 4.5 or higher. Those rates are already about 1 percent higher.
Prediction 2: Expect less intense competition
As prices continue to rise for homes and mortgage rates increase, some would-be buyers will be forced out of the market. That was the experts’ prediction earlier this year, and it seems to be coming to fruition. That is what was recently reported in an article by Fortune Magazine.
Prediction 3: Home price appreciation will slow
Even though most housing experts expect home prices to rise in 2022 and beyond, there is some debate about how quickly they will increase.
CoreLogic, a leading provider of data and analytics for the housing market, recently reported that as of March 2022, U.S. home prices continued to post significant year-over-year gains. Those year-over-year gains in March were up by 20.9%. However, they did predict that the rate of increase is expected to slow to around 6% by next March.
Prediction 4: It will be easier to obtain pricier homes
According to data provided by Yun from the National Association of Realtors, the supply of homes priced at $500,000 and below is being gobbled up. “There are more listings at the upper end, homes priced above $500,000, compared to a year ago, which should lead to less hurried decisions by some buyers,” says Yun. Source: CoreLogic
Prediction 5: Foreclosures will rise
Mortgage forbearance programs are coming to an end as the pandemic winds down. People that are still not working may no longer be in a position to pay their mortgage. The inevitable consequence is that the number of foreclosures will increase.