Buying a House in 2022? Here's What to Know

Considering buying a house in 2022? That’s exciting news. With this article, learn more about mortgage rates, housing inventory, and other things that could impact your purchase. Here are just a few predictions that experts have made about what to expect when buying a house.

Mortgage rates for 2022 will rise slightly

Mortgage rates peaked slightly at the beginning of 2022, which was expected. But they have continued to rise since then, perhaps beyond what was expected. In 2021, mortgage rates averaged somewhere just below 3 percent. But as of April, current rates are around 5 percent. That’s about a percent over what most experts believed interest rates would fluctuate around in April. 

That said, it’s likely that they will continue to rise for at least a while. So if buying a home this year is on your must-have list, it would be better to buy now than wait any longer. And those with better credit scores might still be able to secure a slightly lower rate.

Inventory of homes for 2022 remains low

While many experts predicted that the inventory of homes would increase in 2022, as of April—a lack of building supplies and access to other material has caused inventory to remain low. Some experts predict that the US is about four to six million homes short at the moment. That means increased demand from buyers, which can often lead to bidding wars and higher priced homes. 

Another thing contributing to low housing inventory is the fact that some sellers have been scared off by the ongoing increase in mortgage rates in 2022. That said, new home construction could come to the rescue for many home buyers. New home construction has soared over 20 percent. New home builders can also help to simplify the home buying process and eliminate bidding wars for some buyers.

Seasonal shifts in home buying

What you might not know is that the weather can also impact buying a house in 2022 and the availability of housing inventory. Fewer people tend to buy homes in the colder months, but as spring sets in more and more home buyers will become active. This means you can expect the competition for homes to go up fairly continuously until the fall. However, many home sellers also wait until the busy season to list their homes in hopes of getting the best price. So while home prices might be higher, you may also have a great selection to choose from. 

While buying a house in 2022 may be more of a challenge than it was last year, there are still a few reasons that could make buying a home worth it—like the opportunity to build home equity. If buying a house is on your radar in spite of rising mortgage rates and low home inventory, you’ll want to be sure to develop a new home budget. Sticking to a budget can help you afford the home of your dreams while staying on a budget that still supports your financial goals.

Contributed to Your Home blog

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Published 4.22.2022