17 housing developments that outlined the 12 months, together with report residence costs and sky-high mortgage charges
The 2022 housing market was nothing wanting exceptional. The pandemic and ensuing distant work continued to outline how, when, and the place folks purchased properties. The median U.S. residence value hit a report excessive earlier than falling barely. Rising rents stretched renters’ budgets. Excessive inflation put elevated strain on virtually everybody. For the primary time in historical past, mortgage charges doubled within the span of only one 12 months. The record goes on
Basically, 2022 was a response to the dramatic actual property increase in 2021. The 12 months began with a surge in costs and development throughout the board earlier than falling alongside report inflation within the fall. November and December noticed a a lot slower and seasonally-expected housing market, with year-over-year adjustments in lease costs, home costs, and rates of interest both falling or slowing down.
Beneath is a non-exhaustive record of knowledge factors and visuals that outlined the 2022 housing market.
1. Residence costs rose to an all-time excessive
In Might, the standard residence offered for $430,365, a report excessive since information started in 1963, shattering 2021’s excessive of $386,000. In March, the median sale value rose 16.8% 12 months over 12 months, the biggest share enhance over the past 5 years. Following the pandemic, demand skyrocketed whereas provide remained traditionally low, inflicting a extreme housing scarcity and value increase that continued all through 2021 and peaked halfway by means of 2022. In April and Might, mortgage charges rose to fight rising inflation, which started reversing housing developments from earlier within the 12 months.
Regardless of a rapidly cooling housing market, costs are nonetheless greater in the present day than any earlier 12 months on report.
2. San Francisco was the most costly metro space for homebuyers in 2022
The median sale value of a house in San Francisco was $1,505,000 in 2022, up 0.3% 12 months over 12 months. For one week in April, the median value reached a excessive of $1,700,000, slightly below 2021’s all-time excessive of $1,728,000. Because the 12 months went on, costs dropped nearer to pre-pandemic ranges, which is able to doubtless proceed till mortgage charges fall additional.
- Six of the highest ten costliest metros have been in California.
- Many Florida metros skilled the biggest year-over-year value development, together with Tampa (18%), Orlando (14.9%), Jacksonville (14.7%), and Miami (14.2%).
- Tampa had the biggest year-over-year value development of all giant metros within the nation.
The highest ten costliest cities to purchase a house in 2022
Metropolis |
Median sale value |
Yr-over-year change |
San Francisco, CA |
$1,505,000 |
+0.3% |
San Jose, CA |
$1,435,000 |
+7.2% |
Anaheim, CA |
$970,000 |
+10.4% |
Oakland, CA |
$939,000 |
+4.2% |
Los Angeles, CA |
$850,000 |
+7.0% |
San Diego, CA | $815,000 |
+10.3% |
Seattle, WA |
$777,000 |
+9.3% |
New York, NY |
$683,000 |
+5.5% |
Boston, MA |
$650,000 |
+7.7% |
Nassau County, NY |
$600,000 |
+5.8% |
Information consists of the yearly aggregated median sale costs out of all properties offered in every of the 50 largest metropolitan areas. Information doesn’t take note of native median incomes and residential affordability.
3. Detroit was the least costly metro space for homebuyers in 2022
The median sale value for a house in Detroit was $165,000 in 2022, up 3.3% 12 months over 12 months. Residence costs in Detroit hit $213,000 for every week in June, making it the most costly month of the 12 months however nonetheless almost 50% decrease than the nationwide median. Basically, year-over-year value will increase in 2022 have been smaller throughout most main metros than in 2021, and development dipped additional heading into the primary week of December.
- The highest ten least costly metros have been all positioned within the Rust Belt, a geographic area close to the Nice Lakes.
- Philadelphia was the one giant metro that skilled a value lower in 2022.
- Kansas Metropolis, MO was the eleventh least costly metro, and the primary non-Rust-Belt metro on the record.
The highest ten least costly cities to purchase a house in 2022
Metropolis |
Median sale value |
Yr-over-year change |
Detroit, MI |
$165,000 |
+3.3% |
Cleveland, OH |
$185,000 |
+5.4% |
Pittsburgh, PA |
$205,000 |
+2.4% |
St. Louis, MO |
$235,000 |
+9.6% |
Cincinnati, OH |
$239,000 |
+7.7% |
Philadelphia, PA |
$249,900 |
-0.01% |
Milwaukee, WI |
$260,000 |
+4.8% |
Warren, MI |
$262,000 |
+4.5% |
Indianapolis, IN |
$275,000 |
+11.6% |
Columbus, OH |
$290,000 |
+10.3% |
Information consists of the yearly aggregated median sale costs out of all properties offered in every of the 50 largest metropolitan areas. Information doesn’t take note of native median incomes and residential affordability.
4. Hire costs rose dramatically as provide struggled to maintain up with demand
Hire costs in 2022 have been 12.8% greater than they have been in 2021. Nationwide, the median lease value rose to $2,053 in August earlier than dipping barely, the very best on report and a 12.3% enhance year-over-year. Following the pandemic, lease costs skyrocketed largely due to a lack of provide and a increase in demand, each of that are simply now balancing out.
- Median lease costs in New York rose to over $4,000, retaining its dominance as the most costly metro for renters within the nation.
- Most of the least costly metros skilled the very best year-over-year lease will increase, together with Oklahoma Metropolis (23.3%), Cincinnati (17.6%), and Pittsburgh (14.8%).
- Oklahoma Metropolis skilled the very best year-over-year lease will increase within the nation.
- Hire development has constantly outpaced wages for many years, however the newest knowledge states {that a} staggering 40% of renters spent greater than 30% of their earnings on lease from 2017-2021.
There are at present over 1.1 million rental models underneath building within the U.S., which is able to come accessible for lease over the subsequent 12 months, serving to to alleviate a part of the housing scarcity.
“We anticipate rents to fall in almost each a part of the nation by the center of 2023 as provide begins overtaking demand,” notes Taylor Marr, Redfin Deputy Chief Economist. “Whereas renters sometimes get the most effective deal through the winter months as demand is decrease, rents are persevering with to ease. Due to this, there gained’t be as a lot of a seasonal enhance come spring, and thus persistence for a superb deal will repay. And don’t be afraid to barter; some landlords could also be open to concessions like a free month’s lease or free parking.”
The highest ten costliest cities for renters in 2022
Metropolis |
Median lease value |
Yr-over-year change |
New York, NY |
$4,043 |
+10.8% |
Boston, MA |
$3,764 |
+3.1% |
San Francisco, CA |
$3,749 |
+7.6% |
San Jose, CA |
$3,558 |
+7.3% |
Los Angeles, CA |
$3,435 |
+0.8% |
San Diego, CA |
$3,345 |
+8.2% |
Miami, FL |
$3,098 |
+8.7% |
Seattle, WA |
$2,994 |
+7.0% |
Sacramento, CA |
$2,749 |
+6.7% |
Denver, CO |
$2,700 |
+4.6% |
The highest ten least costly cities for renters in 2022
Metropolis |
Median lease value |
Yr-over-year change |
Oklahoma Metropolis, OK |
$1,308 | +23.3% |
Louisville, KY |
$1,372 |
+13.2% |
San Antonio, TX |
$1,442 |
+12.4% |
Cleveland, OH |
$1,447 |
+4.7% |
Indianapolis, IN |
$1,454 |
+13.9% |
Kansas Metropolis, MO |
$1,456 |
+3.1% |
St. Louis, MO |
$1,547 |
+4.8% |
Buffalo, NY |
$1,555 |
+9.7% |
Columbus, OH |
$1,571 |
+4.8% |
Memphis, TN | $1,581 |
+9.5% |
Information consists of the 2022 aggregated median lease costs for every of the 50 largest metropolitan areas in comparison with 2021 knowledge from the identical interval. Information is the median of all 0-3 bed room rental properties.
5. Homebuyers trying to relocate favored Solar-Belt cities
24.1% of homebuyers seemed to maneuver to a distinct metro through the three months ending in November. That is on par with the report excessive of 24.2% within the third quarter and up from 19.1% in 2019.
- Homebuyers seemed to maneuver to sunny, comparatively reasonably priced areas, with Miami, Tampa, Las Vegas, and Phoenix being the most well-liked locations.
- Homebuyers seemed to maneuver away from costly coastal metros like San Francisco, Los Angeles, and New York, which topped the record.
- 100% of properties in lots of well-liked relocation metros skilled extreme drought previously 12 months, together with Phoenix, Las Vegas, and Sacramento.
“Much like 2021, continued development in distant work and a want for housing affordability drove relocation patterns in 2022,” Marr continues. “Nonetheless, developments in some well-liked locations reversed course after they grew to become too well-liked, aggressive, and costly. Cities like Salt Lake Metropolis, Phoenix, Tucson, Dallas, and San Antonio all declined in recognition in 2022.”
Information is the % of Redfin.com customers looking for properties outdoors their metro. Information is the 12 months median mixture of a number of three month shifting aggregates and doesn’t embrace September-December. Sustain with the most recent migration information right here.
6. Inflation rose at a report tempo, affecting each aspect of the housing market
The costs of products and companies rose to six.48% 12 months over 12 months in November, the very best share since August 1982 and greater than double the speed from November 2021. In reality, inflation charges have doubled in comparison with the earlier 12 months in each month since June. Rising costs severely restricted client spending and slowed almost each aspect of the housing market.
-
- To fight the historic inflation, the Fed raised its goal rate of interest to 4.5%, the very best in 15 years.
- Skyrocketing rates of interest brought about mortgage charges to rise and elevated fears of a recession, conserving homebuyers out of the housing market.
- Inflation rose the quickest in pandemic boomtowns due partly to the sudden soar in home costs, which is a key contributor to inflation.
Information courtesy of FRED. Information measures core CPI (much less meals and power) by means of November 2022.
7. Mortgage charges ballooned to just about 7% in response to report inflation
After a long time of falling mortgage charges, in 2022, charges climbed to just about 7% in each October and November, greater than any level since 2002. In reality, from October 2021 to October 2022, mortgage charges doubled in a single 12 months for the primary time in historical past.
Because the 12 months got here to a detailed, optimistic inflation knowledge helped scale back housing rates of interest to beneath 7%.
- In well-liked migration metros like Phoenix, Las Vegas, and Austin, greater mortgage charges and costly residence costs damage consumers probably the most.
- In Phoenix, for instance, as mortgage charges climbed in Might and June, solely 21.5% of properties have been reasonably priced to consumers with a $2,500 month-to-month mortgage price range – a 28.5% drop from 2021.
Excessive inflation and rising mortgage charges typically deter consumers, however in the event you’re capable of afford it, possession could be the higher possibility. “Homeownership is a long-term funding that may result in vital web value beneficial properties, even with charges above 6%,” advises Dean Hayes, Space Gross sales Supervisor with Bay Fairness, a Redfin firm. “Mortgage charges will doubtless go down within the new 12 months, that means extra residence consumers will return to the market, creating elevated competitors and fewer room for negotiation.”
8. Housing stock rose after hitting a report low
10.7 million properties have been listed on the market by means of November, up 11.2% in comparison with the 9.5 million properties listed by means of November in 2021. Within the three months ending November 2022, the variety of properties on the market elevated by 15% 12 months over 12 months, the largest enhance on report.
As mortgage charges rose alongside inflation, extra consumers determined to remain put, permitting stock to extend. Since December 2019, stock has declined 12 months over 12 months till it lastly rose in June 2022.
“Patrons have extra leverage now than they’ve since 2010,” advises San Francisco Redfin agent Josh Felder. “Even with greater mortgage charges, in the event you intend to remain put for longer than 5 years, it’s an amazing funding. Houses are forecast to nonetheless respect, even in gentle of present circumstances. Sellers ought to perceive that the market remains to be shifting. Houses don’t promote in 5 days, properly over record value, anymore.”
Stock and provide are calculated in rolling 90-day intervals, e.g., January 2022 knowledge is the three-month interval from November 1, 2021, by means of January 31, 2022.
9. Months of provide dropped to a near-record low of simply 1.2 months
Whereas stock measures the variety of properties at present accessible on the market, months of provide measures the period of time it will take these properties to promote. 4 to 5 months of housing provide is taken into account the optimum benchmark. Lower than three months of housing provide typically implies that there are extra consumers than sellers, whereas the next quantity means there are extra sellers than consumers. Stock and provide sometimes transfer collectively.
Nationwide, months of housing provide dipped to only over 1.2 months in March earlier than slowly rebounding in the summertime. Yr over 12 months, months of provide has declined virtually each month since January 2020.
- As consumers retreated attributable to excessive inflation and rates of interest, months of provide started to develop in July and August, reaching 2.3 months of provide by September.
- In Seattle, months of provide reached a near-record low of simply 15.5 days in January and February, the bottom of any main metropolitan space.
“We’re rapidly working again towards a balanced market, which is three to 6 months of stock,” says Seattle-area Redfin agent Brian Shields. “We’ve been in a vendor’s market with lower than 5 months of stock for a number of years, till halfway by means of this 12 months. Patrons now have much more decisions than they did final Spring.”
Stock and provide are calculated in 90-day intervals, e.g., January 2022 knowledge is the three-month interval from November 1, 2021, by means of January 31, 2022.
10. New building took up a rising share of housing stock
There have been 1.25 million privately-owned new properties constructed within the U.S. by means of November 2022, up 3% from a 12 months in the past. As inflation rose and the market slowed, builders started slowing their manufacturing to unload what they already had.
New building has been taking over a rising portion of general housing provide since 2011, when constructing rebounded after the monetary disaster. This development intensified in 2021 and solely not too long ago started to decelerate. “For those who’re a purchaser, take into account new building properties,” advises Kim Stearns, a Northern Idaho Redfin agent. “Due to a listing buildup, many builders have one to 4 properties they’d love to shut on and can typically supply incentives.”
- Over 63% of recent builds have been single-family properties, up 2% 12 months over 12 months
- New building begins dropped from their peak of 164,000 in April to 111,000 in November
Information courtesy of Census.gov.
11. Residence gross sales fell almost 17% 12 months over 12 months
5.62 million U.S. properties offered by means of November, down 16.6% 12 months over 12 months, a pointy lower from the 6.74 million offered in 2021 throughout the identical interval. Basically, between 4 and 7 million properties promote per 12 months, with the historic common sitting at simply over 5 million. Yr-over-year residence gross sales decreased in each month of 2022, with October and November posting the sharpest declines.
- Simply 376,000 properties offered in November, down 37.4% 12 months over 12 months and a seasonally-adjusted historic low (since 2001).
- June was the busiest month with 626,641 properties offered, a 15.2% year-over-year dip.
Information was collected by means of November.
12. Median days on market rose at a report tempo, signaling a dramatic turnaround from 2021’s breakneck tempo
In 2022, properties spent a mean of simply 24 days available on the market, an 8.4% enhance 12 months over 12 months in comparison with the 22 days available on the market in 2021. Since 2020, a housing provide crunch has been attributable to provide chain points, a power lack of homebuilding, and a rise in demand. In 2022, time available on the market ticked up as homebuilding started to catch as much as demand and excessive mortgage and inflation charges restricted consumers’ spending energy.
“Attributable to a slowing financial system and layoffs within the tech sector close to the top of the 12 months, many consumers paused their residence search attributable to affordability and job safety,” notes Frank Vettesse III, a San Francisco Redfin agent. “This was one among many elements that contributed to the dramatic slowdown in gross sales.”
- Might was the busiest month of the 12 months, with properties spending a mean of simply 17 days available on the market.
- Within the 4 weeks ending December 4th, properties spent a mean of 37 days available on the market, the slowest month of 2022 and the largest year-over-year slowdown on report.
13. 14% of lively residence listings skilled value drops
On common, 14% of lively properties on the market had value drops in 2022, up 4.7% 12 months over 12 months. In October, 22.6% of listings had value drops, a decades-long excessive. In reality, from February by means of July, the variety of properties with value drops rose from 5.7% to 19.5%, a record-fast enhance. “The shift was dramatic,” says Christy Seashore, a Seattle-area Redfin agent. “The consumers who didn’t safe a house through the peak of competitors are actually bidding low. For instance, the identical kind of residence that consumers have been keen to supply $200,000 over record value are actually providing $200,000 beneath record value.”
- In Denver, 47% of properties skilled reductions in value, the very best share of any main metropolis.
- Despite the fact that value drops have been widespread, median sale costs nonetheless elevated in virtually each metro within the county.
- Many pandemic-era migration hotspots, akin to Tampa, Las Vegas, and West Palm Seashore, had a big share of listings with value drops as properly.
“As sellers with stale listings grew to become more and more anxious to get their properties offered, we noticed a steep rise in value drops by means of the summer season right here in Washington State,” says Darlene Haselton, a Tacoma, WA Redfin agent. “At present, properties which might be recent available on the market are beginning to transfer extra rapidly. As mortgage charges dip additional, in-demand properties could begin receiving a number of affords.”
The highest 5 cities with the very best share of value drops in 2022
Information consists of the median value drops out of all lively listings in every of the 50 largest metropolitan areas.
14. 55% of properties had a bidding warfare
55% of properties had bidding wars in 2022, down from 64% in 2021. Coastal metros skilled the very best charges of bidding wars, together with Boston (69.8%) and Los Angeles (67.7%).
Nonetheless, nationwide, bidding wars fell from 72% to 35% from February to November. A worsening financial system, greater mortgage charges, and a rise in provide contributed to the slowdown.
Shauna Pendleton, a Boise, ID Redfin agent, advises sellers to be affected person and look forward to mortgage charges to drop. “Until a house is priced $100,000 or extra underneath market worth, bidding wars are principally non-existent. Our group nonetheless hears of some multiple-offer conditions; in these circumstances, it’s sometimes a luxurious residence in a high-demand neighborhood that’s priced very aggressively.”
The highest 5 metros with the very best share of bidding wars in 2022
Information consists of the median share of bidding wars throughout lively listings in every of the 50 largest metropolitan areas.
15. Over 30% of properties have been bought with money in 2022
30.7% of properties have been bought with all money, up 2% 12 months over 12 months. In October (the newest knowledge accessible), 32% of properties have been paid for with all money, up 2% 12 months over 12 months and the very best share since 2014.
- Florida was the most well-liked state for all-cash purchases, particularly Jacksonville and West Palm Seashore.
- Costly west coast metros, together with Oakland, San Jose, and Seattle, had the bottom share of all-cash purchases.
Information is from a Redfin evaluation of county information throughout 39 of probably the most populous U.S. metropolitan areas, relationship again by means of 2011. Information doesn’t embrace November or December.
16. Actual property traders bought almost 20% of obtainable listings, a brand new report
Vying to capitalize on the housing and rental increase, traders bought 233,701 properties in 2022 by means of September, a record-breaking 19.1% of all listings. Multifamily residential properties constituted the biggest share of investor market share, with a mean of 30% of those properties being bought by traders.
Pandemic boomtowns grew to become the biggest investor hotspots, particularly in Solar-Belt metros.
The highest 5 metros with the biggest investor market shares in 2022
Information is analyzed on a quarterly foundation and consists of all property sorts until in any other case said. Complete share is the common of knowledge from January-September. Information doesn’t embrace the final quarter of 2022.
17. Luxurious residence gross sales skilled their largest year-over-year decline on report
In 2022, there have been 258,733 luxurious properties offered within the U.S., down 27% 12 months over 12 months and the largest decline since 2012. Energetic listings dropped even additional, falling by 32.7% 12 months over 12 months. The median sale value for a luxurious residence was $1,080,000, up 14.8% 12 months over 12 months. Costs reached their peak of $1,120,000 through the three months ending Might, a 15.7% year-over-year enhance. Nonetheless, value development, listings, and gross sales slowed considerably as demand cooled later within the 12 months.
- Within the three months ending November thirtieth, luxurious residence gross sales fell by 38.1%, the biggest drop on report.
- Luxurious properties spent a mean of 32 days available on the market by means of November, up 28.9% 12 months over 12 months
- Tampa was the quickest rising luxurious market, with costs rising by 32.3% 12 months over 12 months
- Luxurious residence gross sales declined by 47% in San Jose, the largest fall of any main metro
“In Seattle, luxurious listings noticed the biggest reductions in value,” continues Seattle agent Christy Seashore. “Within the present market, most sellers with a value level of $1.5 million or greater want to arrange to make their residence stand out among the many competitors. Most of the time, sellers are having to barter their value and phrases with consumers.”
Luxurious properties are outlined as the highest 5% of listings in a given market. Values are three month shifting aggregates ending on the date proven, e.g., November 2022 spans September, October, and November 2022. Information doesn’t embrace the three months ending December 31.
Wanting ahead
The 2022 housing market was chaotic, however what does Redfin predict for 2023? Learn our 2023 Housing Market Predictions to be taught extra.
All knowledge was compiled by the week ending December 23, 2022. Information is aggregated from January to November and doesn’t embrace December until said in any other case. All knowledge is from Redfin, FRED, and/or public information. For questions on metrics, learn our metrics definitions web page.