What to Expect in the 2022 Housing Market

The decisive force in the 2022 housing market will likely be inventory after a year of high competition and low supply, according to Bill McBride’s CalculatedRisk Newsletter.

If inventory increases significantly in the coming year, the market will see fewer housing starts and a lower price appreciation compared to a jump in home starts and home prices in 2021.

The key in 2022 will be inventory. If inventory stays extremely low, there will be more housing starts and a larger increase in prices. However, if inventory increases significantly, there will be fewer starts and less price appreciation.

For comparison, new home sales in 2021 will probably be around 800 thousand, down from 822 thousand in 2020, but up from 683 thousand in 2019.

Total housing starts will be around 1.58 million in 2021, up from 1.38 million in 2020, and up from 1.29 million in 2019.

Existing home sales will be around 6.1 million in 2021, up from 5.64 million in 2020, and 5.34 million in 2019.

As of August, Case-Shiller house prices were up 19.8% year-over-year!

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