Despite a dearth of homes for sale and the typical monthly mortgage payment reaching a new high, homebuyers are eager to get their foot in the door before mortgage rates tick up further. Redfin economists expect the dynamics to shift around summertime, when still higher home prices and rates cause buyers to take a step back.
Home-price growth, which has been in the double digits since Summer 2020, is expected to slow to an annual rate of 7% by the end of 2022, according to a new forecast by Redfin economists. Home sales are expected to remain relatively flat throughout the year, similar to the small annual rate of change they have been posting since August due to the ongoing shortage of homes for sale. Redfin economists expect the 30-year fixed mortgage rate to continue to rise steadily to 3.9% over the course of the year.