[New post] Corelogic’s UPDATED Housing Market Predictions for 2022! We compare to Redfin’s!
caryngardiner posted: " CURRENT UPDATE!!! Corelogic & Redfin have updated their housing market predictions for 2022. Who's Data is Right? Will home prices finally fall in 2022 since mortgage interest rates are continuing to rise in the housing market? Will the inventory fin"
CURRENT UPDATE!!! Corelogic & Redfin have updated their housing market predictions for 2022. Who's Data is Right? Will home prices finally fall in 2022 since mortgage interest rates are continuing to rise in the housing market? Will the inventory finally increase allowing buyers to take their time on purchasing a house? Or will first time home buyers be priced out of the market due to scarce inventory and higher interest rates? We also take a look at today's market in Washington DC and Maryland.
Articles used:
Corelogic.com: U.S. Home Price Insights
Redfin News: Housing Market Update
Bright MLS: Home Demand Index
Today were going to look at Corelogics updated housing predictions for 2022, compare them with Redfin and then take a look at our local DC/Montgomery County Housing statistics so we can see where we are at right now at the end of February 2022.
Home prices nationwide, including distressed sales, increased year over year by 18.5% in December 2021 compared with December 2020.
The CoreLogic HPI Forecast indicates that home prices will remain flat on a month-over-month basis from December 2021 to January 2022, and increase on a year-over-year basis by 3.5% from December 2021 to December 2022.
Redfin- Home-price growth, which has been in the double digits since Summer 2020, is expected to slow to an annual rate of 7% by the end of 2022, according to a new forecast by Redfin economists.
Corelogic: Consumer desire for homeownership against persistently low supply of for-sale homes created one of the hottest housing markets in decades in 2021 — and spurred record-breaking home price growth.
Price appreciation averaged 15% for the full year of 2021, up from the 2020 full year average of 6%. Home price growth in 2021 started off at 10% in the first quarter, steadily increasing and ending the year with an increase of 18% for the fourth quarter.
While there have been questions surrounding whether we are currently in a housing bubble, the CoreLogic Market Risk Indicators suggest a small probability of a nationwide price decline, and points to the larger likelihood that a fall in price will be limited to specific, at-risk markets
Comparing the average projected National HPI (home price insight) for 2022 with the previous year, the CoreLogic HPI Forecast shows the annual average up 9.6% in 2022.
"Much of what we've seen in the run-up of home prices over the last year has been the result of a perfect storm of supply and demand pressures. As we move further into 2022, economic factors – such as new home building and a rise in mortgage rates – are in motion to help relieve some of this pressure and steadily temper the rapid home price acceleration seen in 2021."
– Dr. Frank Nothaft Chief Economist for CoreLogic
These large cities continue to experience price increases in December, with Phoenix leading the way at 30.2% year over year.
Markets to Watch: Top Markets at Risk of Home Price Decline
Newly Listed Homes in Short Supply, Down 12% in January
Home sales posted strong monthly gains despite rising mortgage rates and record-low supply.
Fewer homes than ever were for sale in January, but homebuyers snapped up what they could before mortgage rates rose further. Seasonally adjusted new listings fell 12.4% month over month, bringing the number of homes for sale down 2.6% to a record low. But demand persisted, and sales rose 7.5%.
"We believe that the inventory crunch will ease in the summer as rates rise, but may not go away in 2022," said Redfin CEO Glenn Kelman on Redfin's Q4 earnings call. "We're well aware of the economic pressures on homebuyers, but so many people are still so desperate to move that sales for now are still mostly constrained by inventory, not prices or even mortgage rates."
The housing market is changing rapidly in the opening months of 2022 with mortgage rates up 0.81 points between December 30 and February 17. Rising rates are likely to slow competition somewhat by summer.
The national median home sale price in January was up 14% from a year earlier to $376,200. Median sale prices increased from a year earlier in all but one of the 88 largest metro areas Redfin tracks. The only metro area with a decrease was Bridgeport, CT, where home prices fell 2% from a year earlier following a 22% year-over-year increase in January 2021. The largest price increases were in North Port, FL (+32%), Austin, TX (+32%) and Phoenix, AZ (+29%).
The typical home that sold in January went under contract in 27 days—a week faster than a year earlier, when homes sold in a median 34 days, and up 12 days from the record low of 15 days in June.
Bright Insights, February 2022: Home demand rose across the major metros in January, as the market saw more seasonal gains compared to last year's records.
Sales activity declined to more seasonal levels in what is still a sellers' market, with homes selling for 100% or more of the asking price.
The challenge of limited supply continues to be a key factor in rising prices, and will likely impact buyers heading into the spring market.
Metro Area Overview
Demand for homes in the Washington Metro area rose in January following two months of seasonal declines in year-end buyer activity. The Bright MLS | T3 Home Demand Index rose slightly more than 23 percent in January to 85, reflecting a Slow pace of home demand. The Index was in the Limited range in December.
The market trend line, below, provides a high-level monthly overview of the Home Demand Index for each of the metro market areas within the Greater Washington D.C. Metro Area. The Home Demand Index is baselined at 100, with 90-110 indicating a steady market. Index values above 110 indicate moderate and high activity while Index values below 90 indicate slower or limited activity.
The Index rose for each type of home in January with the greatest increases in higher-priced single-family homes and higher-priced condos, each rising by more than half compared with December. In addition to rising the most, demand was strongest for higher-priced single-family homes and higher-priced condos. The lower- priced single-family segment exhibited the weakest demand. The months supply rose for all market segments with inventory levels ranging from just 0.9 months supply for mid-priced single-family homes to a three-month supply for higher-priced condos.
The Index rose for each type of home in January with the greatest increases in higher-priced single-family homes and higher-priced condos, each rising by more than half compared with December. In addition to rising the most, demand was strongest for higher-priced single-family homes and higher-priced condos. The lower- priced single-family segment exhibited the weakest demand. The months supply rose for all market segments with inventory levels ranging from just 0.9 months supply for mid-priced single-family homes to a three-month supply for higher-priced condos.
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