The U.S. real estate market remains hot ahead of the spring selling season, with existing home sales up 6.7% as of last measure, according to the National Association of REALTORS^®. Experts attribute the growth in sales to an uptick in mortgage interest rates, as buyers rushed to lock down their home purchases before rates move higher. Mortgage rates have increased almost a full percentage point since December, with the average 30-year fixed-rate mortgage briefly exceeding 4% in February, the highest level since May 2019.

New Listings decreased 4.6 percent for single-family homes and 5.4 percent for townhouse-condo properties. Pending Sales decreased 17.3 percent for single family homes but increased 3.6 percent for townhouse-condo properties.

Inventory decreased 42.7 percent for single-family homes and 54.5 percent for townhouse-condo properties.

The Median Sales Price was up 12.5 percent to $365,500 for single-family homes and 24.0 percent to $310,000 for townhouse-condo properties. Days on Market decreased 35.7 percent for single-family homes and 66.7 percent for townhouse-condo properties. Months Supply of Inventory decreased 41.7 percent for single-family homes and 57.1 percent for townhouse-condo properties.

Inventory was at an all-time low of 860,000 as February began, down 17% from a year ago and equivalent to 1.6 months supply. According to Lawrence Yun, Chief Economist at the National Association of REALTORS^®, much of the current housing supply is concentrated at the upper end of the market, where inventory is increasing, while homes priced at the lower end of the market are quickly disappearing, leaving many first-time buyers behind.

The shortage of homes is boosting demand even further, and with bidding wars common in many markets, it’s no surprise sales prices continue to soar.

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The 2022 real estate market begins where 2021 left off, in which existing home sales reached their highest level since 2006, with the National Association of REALTORS® reporting sales were up 8.5% compared to the previous year as homebuyers rushed to take advantage of historically low mortgage rates. Home sales would’ve been even greater were it not for soaring sales prices and a shortage of homes for sale in many markets, forcing a multitude of buyers to temporarily put their home purchase plans on hold.

New Listings decreased 27.4 percent for single-family homes and 32.4 percent for townhouse-condo properties. Pending Sales decreased 7.9 percent for single-family homes and 32.6 percent for townhouse-condo properties. Inventory decreased 50.9 percent for single-family homes and 45.8 percent for townhouse-condo properties. The Median Sales Price was up 16.5 percent to $395,000 for single-family homes and 17.5 percent to $275,750 for townhouse-condo properties. Days on Market decreased 16.7 percent for single-family homes and 57.7 percent for townhouse-condo properties. Months Supply of Inventory decreased 50.0 percent for single-family homes and 42.9 percent for townhouse-condo properties.

For many buyers, 2022 marks a new opportunity to make their home purchase dreams a reality. But it won’t be without its challenges. Inventory of existing homes was at 910,000 at the start of the new year, the lowest level recorded since 1999, according to the National Association of REALTORS®, and competition remains fierce. Affordability continues to decline, as inflation, soaring sales prices, and surging mortgage interest rates reduce purchasing power. The sudden increase in rates and home prices means buyers are paying significantly more per month compared to this time last year, which may cause sales to slow as more buyers become priced out of the market.

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The 2021 housing market was one for the history books. After three consecutive months of increases recently, existing home sales are on pace to hit their highest level in 15 years, with an estimated 6 million homes sold in 2021 according to the National Association of REALTORS®. Sales prices reached new heights, inventory hit rock bottom, and homes sold in record time, often for well above asking price. Mortgage rates, which began the year at historic lows, remain attractive, and homeowners who choose to sell in the coming months can expect to see plenty of buyer activity due to pent-up demand during the pandemic.

New Listings decreased 2.2 percent for single-family homes and 10.5 percent for townhouse-condo properties. Pending Sales remained flat for single-family properties but increased 9.8 percent for townhouse-condo properties. Inventory decreased 46.2 percent for single-family homes and 54.2 percent for townhouse-condo properties. The Median Sales Price was up 14.3 percent to $400,000 for single-family homes and 29.9 percent to $315,000 for townhouse-condo properties. Days on Market remained flat for single-family homes but increased 2.8 percent for townhouse-condo properties. Months Supply of Inventory decreased 47.1 percent for single-family homes and 55.6 percent for townhouse-condo properties.

Looking ahead, experts anticipate many of the housing market trends of 2021 will continue in 2022, albeit at a more moderate level. Strong buyer demand and inventory shortages are likely to persist over the next year. Home sales are projected to remain strong but will be tempered by the limited supply of homes, higher sales prices, and rising interest rates, with the Federal Reserve planning multiple rate hikes in the new year. Price growth is expected to slow somewhat as a result, but affordability will likely remain a top constraint for some homebuyers.

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The economy is improving, unemployment is falling, and the U.S. real estate market remains strong as we head into the holiday season, a period when activity typically slows as people take time to travel, celebrate, and spend time with loved ones. Although the market is not as frenetic as was seen earlier this year, buyer demand is high, bolstered by attractive mortgage rates and a low supply of inventory.

New Listings increased 6.1 percent for single-family homes but decreased 4.5 percent for townhouse-condo properties. Pending Sales increased 11.7 percent for single-family homes but decreased 10.4 percent for townhouse-condo properties. Inventory decreased 45.6 percent for single-family homes and 44.8 percent for townhouse-condo properties.

The Median Sales Price was up 15.8 percent to $415,000 for single-family homes and 7.0 percent to $276,000 for townhouse-condo properties. Days on Market decreased 20.5 percent for single-family homes and 44.4 percent for townhouse-condo properties. Months Supply of Inventory decreased 47.4 percent for single-family homes and 40.0 percent for townhouse-condo properties.

The most recent data from the National Association of REALTORS® reports the median single-family existing home sales price rose 16% in the third quarter of this year to $363,700, with all four regions of the country experiencing double-digit price growth. In new construction, builder confidence increased in November, surpassing analyst expectations and rising to 83 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), the highest level since spring, despite persistent labor and supply chain challenges and a shortage of available lots.

The U.S. housing market remains robust, with strong activity reported across both rental and residential housing fronts. Single-family rent prices are increasing rapidly, as demand for single-family housing and inventory constraints forces some buyers to rent, increasing competition and pushing rents up across the nation. Meanwhile, sales of new construction single-family homes recently hit a six-month high, rising 14% to a seasonally adjusted rate of 800,000, according to the latest data from the U.S. Department of Housing and Urban Development.

New Listings decreased 20.6 percent for single-family homes and 19.0 percent for townhouse-condo properties. Pending Sales decreased 1.9 percent for single-family homes and 17.5 percent for townhouse-condo properties. Inventory decreased 43.3 percent for single-family homes and 43.2 percent for townhouse-condo properties.

The Median Sales Price was up 16.5 percent to $396,000 for single-family homes and 2.7 percent to $285,000 for townhouse-condo properties. Days on Market decreased 25.0 percent for single-family homes and 31.4 percent for townhouse-condo properties. Months Supply of Inventory decreased 43.5 percent for single-family homes and 36.4 percent for townhouse-condo properties.

As temperatures drop, existing home sales continue to be plentiful, buoyed by strong demand, low interest rates, and a slight uptick in new listings in recent months, according to the National Association of REALTORS®. With interest rates inching upward, and experts expecting further rate increases on the horizon, motivated buyers are hoping to lock in their home purchases to take advantage of what are still historically low rates.

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