Mortgage Market review and Update for 2022
Posted February 1st 2022
We have seen mortgage rates moving higher in the beginning of the year. Rates are at the highest level since May 2020, and during the past two years we have seen 30 year fixed mortgage rates average close to 3.00%. This low rate environment through the majority of 2020 and 2021 helped strengthen the residential home sale market, and created record refinance activity nationwide.
The current rate environment has seen pressure from higher inflation, a tight labor market, solid economic growth and this has moved rates up almost ½% in the past 30 days.
The chart below shows the history of 30 year fixed mortgage rates through the past three years, and in the beginning of 2019 rates were at 4.50%. The current rate environment is still almost 1% lower than January 2019.
Lawrence Yun, National Association of Realtors chief economist stated in his 2022 forecast:
“Overall, we will see the housing market and broader economy normalize this year,” Yun said. “Though forecasted to rise 4%, inflation will decelerate after we saw hefty gains in 2021, while home price increases are also expected to ease with an annual appreciation of less than 6% compared to 12% in 2021. Slowing price growth will partly be the consequence of interest rate hikes by the Federal Reserve.”
Yun also stated there will be an increase in the housing inventory in 2022, and this will decrease the intense multiple offers we have seen throughout the pandemic. The increased supply will be generated, in part, from new housing construction – already underway – as well as from the conclusion of the mortgage forbearance program, which in turn will cause a number of homeowners to list and sell their homes.
“Rising rents will continue to place upward pressures on inflation,” Yun said. “Nevertheless, real estate is a great hedge against inflation.”
At CrossCountry Mortgage, we are driven by the commitment to provide unsurpassed customer service, competitive rates and unmatched communication. We have tools and processes to help strengthen your position during your initial offer on a home for sale.
Our loan process at CrossCountry Mortgage is focused on a “21 day clear to close model”, which will allow you to buy your home more quickly. CrossCountry Mortgage was the #1 purchase lender in PA in 2021.
Please contact me to discuss your home financing options,
Tim Roach
Executive Vice President
610-304-2080
tim.roach@myccmortgage.com |
