With the rise in mortgage rates, housing prices should stabilize, but low inventory still ingers.
Low mortgage rates and limited supply helped push prices higher. There were just 1.38 million homes for sale nationally in June, down 23 percent year-over-year, according to Redfin. “The ongoing pandemic, including its seismic effect on the U.S. economy and the way Americans live and work, has made 2021’s housing market anything but typical,” said Daryl Fairweather, Redfin’s chief economist.
“Remote work, low mortgage rates, a shortage of building materials and wealth inequality that has allowed an influx of affluent Americans to buy vacation homes, to name just a few factors, have come together to create a historic year for real estate. Buyers paid more for homes, bought sooner than they planned, searched outside their hometowns or all of the above. [2021′s] frenzied housing market has been one for the books — but it may become more balanced in 2022.”