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Updated about 3 years ago,
- Real Estate Agent
- Denver CO | Colorado Springs, CO
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Real estate market predictions for 2022
Redfin just came out with their real estate predictions for 2022. Personally, as a real estate agent on the ground in Colorado Springs and Denver, I see how often sites like Redfin and Zillow and Realtor.com are wrong about these things, but come on! Who doesn't love a good game of crystal-ball gazing ... accuracy be damned?
A few of the predictions I found interesting:
Mortgage rates will rise to the mid 3% range
This may slow demand a little, which may slow down price growth. The report says appreciation will be only 3% YoY by winter 2022. But take this with a big grain of salt. First off, all real estate is local, so a national price growth estimate is virtually meaningless. Their prediction for 2021 was that home growth would slow to less than 5%. (Here in Colorado Springs, we've seen 16% appreciation in the median home price over this time last year, so Redfin was juuuust a wee bit off.)
New listings will hit 10-year high ... and it won't matter
In 2022, Redfin predicts that new listings will surpass the 2018 high of 7.6 million homes, setting a new record going back to at least 2012. But this will not be nearly enough to offset the ever-increasing demand. (My favorite theory on why high demand will continue and therefore higher prices in attractive markets like Colorado Springs and Denver will continue is all about those damn Millennials.)
Rents will increase 7%
Redfin says the end of mortgage forbearance will cause many homeowners to sell and rent instead. To me, this doesn't ring as true in hot markets like where we work in Colorado. We have one of the lowest mortgage default rates in the country.
Redfin also says that as the pandemic slows down more people will choose to live in cities where rent is more common. This does ring true from what I'm seeing with condo prices and demand for city living options.
Condo demand will take off
This fits with what we see on the ground. Redfin also had an interesting stat that showed in the summer of 2020 -- at the height of the pandemic fear -- 37% of searches on Redfin filtered for single-family homes. Today it's only 28%.
Climate change will impact decisions
This one was interesting to me as we do see larger fires here in Colorado. I'm sure this is true along the coasts with flood risks as well.
Those are just a few of the predictions that interested me. What do you all think? (You can read the full list of real estate 2022 predictions here.