The housing market is expecting a rise in interest rates in 2022. The main question on everyone's minds is - Will interest rate hikes in 2022 slow down the real estate market? Experts for the US economy and housing suggest that we will see a slower housing price appreciation.

The prediction for 2022 is that the annual median home prices will jump by 5.7%. At the same time, inflation will rise 4%. We can also expect a double increase of the federal funds rate by 0.25%.

The following year will bring us a calm market

Based on the findings, the housing market has all the requirements to normalize during 2022. The annual appreciation of home price increases is expected to be less than 6%. This is mainly happening due to the interest rate hikes caused by the Federal Reserves.

Now is the right time to list your home if you are trying to make a sale. The prices are expected to go down, so start looking for buyers.

GDP is slowly starting to grow

US GDP is predicted to grow at the pace of 2.5%. Furthermore, the 30-year fixed mortgage rate will also see an approximate increase to 3.5%. The Federal reserves are raising interest rates as a strategy to control inflation. With that in mind, now is also the right time to buy a house while interest rates are still low.

How did the housing market do during 2021?

Believe it or not, 2021 saw the best performance of the housing market in the past 15 years. There were over 6 million existing-home sales, which is a considerable number. According to royalmovingco.com, the number of relocations also increased by almost 20%. It is a natural occurrence due to the increase in home sales.

What will house sales look like in 2022?

If we consider the incoming interest rate hikes in 2022, some experts say that the existing-home sales will decrease. However, there should be no reason for concern. The housing market will continue to operate. The predicted number of existing-home sales for 2022 is around 5.9 million, which is still very good.

Who are the home buyers of 2022?

There are over 45 million Millennials that are now somewhere between 26 and 35 years of age. They are expected to be the leading first-time buying group. Some experts say that, due to this demand of young households, we might even see an increase in home sales, no matter the prices.

The builders continue increasing production so that the new-homes housing market can keep up during 2022.

Another driving force for first-time buyers will be the expected rent increase of 7.1%. Even though the prices and mortgages are going up, the rent increase will be the strongest motivator to get your own home.

That can also motivate the sellers to present their homes as best as possible. There will be high competition in the sellers' market. If you are planning to sell your home in 2022, you should work on the staging process, as it may increase your chances of finding a buyer quickly.

Are there any advantages for homebuyers?

The competitive jobs market is also one of the driving forces for homebuyers. There is also a projected income increase that we can expect, and it should be somewhere around 3.3%. Employers want to attract new young talents and keep existing ones, hopefully without any impact on the business costs. Due to that, workplace flexibility will still be present during 2022.

As a result, there will be a lot of opportunities for homebuyers to broaden their search. The most sought-after locations will remain the suburbs and some newer, more affordable metro areas.

Other factors that will affect the housing market in 2022

Another factor that will influence homebuyers' decisions is climate change. We have also seen an increase in extreme weather conditions and natural disasters. If we add the pandemic to that, we can predict that there will be a demand for homes with home features resilient to weather changes. The number of climate-conscious homebuyers is also going up every year.

What will happen with the moving industry during the next year?

Since the real estate industry and the moving industry are connected, we must ask ourselves how this change in the housing market affects moving companies. If we look at 2021, over 56% of the American population moved to a new location. That is a substantial number.

Everyone was on the hunt for remote work opportunities and suburban homes. Will moving patterns change in 2022?

Affordable living is still the primary motivator for people looking for moving services. One way that will secure more jobs for moving companies during 2022 is the reduction in prices.

Furthermore, we need to consider the type of the most common relocations for 2022. As we have mentioned, there were a lot of work-related relocations in the past year. Furthermore, family relocations to suburbs were also on the rise.

How to find the right moving company for your relocation?

After selling or buying a home, everyone needs a moving company. If you are looking for movers, there are different ways to help you find the best ones for your pocket. If you don't have any personal recommendations, we advise visiting moving forums and speaking to the people that moved in 2021.

That is a good strategy if you wish to find a company with experience and good reviews.

Since the housing market will change, and there will be an increase in the interest rates, it is crucial to find affordable movers and save some money in the process.

Even with the interest rate hikes in 2022, the housing market will still continue to operate

Even if we see a slower housing market due to the interest rate hikes in 2022, there is still no reason for concern. Whether you are buying or selling, it is crucial to keep an eye open for any favorable opportunities on the market. The good thing is that the economy will finally stabilize after the turmoil caused by the pandemic.

META DESCRIPTION: What are the predictions for the housing market due to the interest rate hikes in 2022? This is what the top US economy experts think.

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