It’s only December, and already the research team from Realtor.com has ranked the top 10 hottest housing markets of 2022.
In the #1 position, we have Salt Lake City, Utah. Real estate forecasts predict that Salt Lake City could be one of the top housing markets of 2022, in terms of home sales and price growth. That’s not surprising, when you look at the skewed supply-and-demand situation in the area.
Forecast: Top 10 Housing Markets of 2022
On December 7, researchers from Realtor.com published a forecast that ranked the “top housing markets of 2022.” They based their rankings on forecasted growth in home prices and sales.
The group analyzed the nation’s 100 largest metro areas and then ranked the top 10 housing markets of 2022. These metro areas are expected to outperform the national average in 2022, in terms of annual home-price growth and sales activity.
Here is the full top-10 list in order of rank:
- Salt Lake City, Utah
- Boise, Idaho
- Spokane, Washington
- Indianapolis, Indiana
- Columbus, Ohio
- Providence, Rhode Island
- Greenville, South Carolina
- Seattle, Washington
- Worcester, Massachusetts
- Tampa, Florida
As shown above, this forecast predicted that the Salt Lake City real estate market would outperform the nation in 2022. Salt Lake City could see significant home-price growth and sales activity in 2022. In other words, more of the same.
Salt Lake City Expected to Outperform
Realtor.com cited pandemic-driven population growth as one of the key factors influencing the local housing market. Migratory trends have also influenced their Salt Lake City real estate forecast for 2022, and the metro’s #1 ranking.
To quote the December Realtor.com report:
“Since the beginning of the pandemic, remote work has prompted an influx of transplants from California and Colorado looking for affordable homes, low cost of living and good schools. Lehi, Utah, also known as Silicon Slopes for its booming tech industry, is just 25 miles away from Salt Lake and home to SanDisk, Adobe and eBay facilities.”
By the end of 2021, the group’s analysts expect the typical home price in Salt Lake City to be around $564,062. That’s more than double where it was back in 2014. And yet prices continue to climb at a steady pace.
Here are their year-over-year predictions for the Salt Lake City housing market in 2022:
- Forecasted home sales change: +15.2%
- Forecasted home price change: +8.5%
Realtor.com isn’t the only group offering a strong forecast for the Salt Lake City real estate scene in 2022. Researchers from Zillow issued an even bolder prediction, projecting double-digit price growth next year.
According to a December 2021 statement on Zillow’s website: “Salt Lake City Metro home values have gone up 27.9% over the past year and Zillow predicts they will rise 17.2% in the next year.”
The chart above (provided by Zillow) shows the median home value for the SLC metro area, going back 10 years. Notice how the line gets steeper over on the right, as home-price growth accelerated. The green shaded area indicates Zillow’s price forecast for Salt Lake City, stretching into 2022.
A Supply-and-Demand Story, as Usual
Like many housing markets across the country, the Salt Lake City metro area is plagued by a shortage of homes for sale relative to buyer demand. In fact, this particular market has one of the lowest inventory levels of any major city in the U.S.
Rock-bottom supply levels have influenced the strong forecasts for the Salt Lake City real estate market in 2022.
As of November 2021, this metro area had roughly a 0.5-month supply of homes for sale. That metric indicates a severely constrained housing market where homes are hard to come by.
Meanwhile, the Salt Lake City area has experienced an increase in demand from home buyers. The Realtor.com quote mentioned above touched on this topic. A lot of buyers have fled pricier housing markets in favor of places like Salt Lake City. This influx has reduced available inventory and caused home prices to skyrocket over the past year.
No Market ‘Crash’ Expected in 2022
Given the meteoric rise of house values in the area, some folks might worry that the Salt Lake City real estate market will crash in 2022. Or at least experience a major downturn.
But based on the above forecasts, that seems highly unlikely.
The more likely scenario — based on market predictions as well as historical patterns — is that home-price growth will start to slow down in 2022. In fact, both Zillow and Realtor.com predicted this very thing. Both groups expect house values in the Salt Lake City area to rise more slowly in 2022 compared to 2021.
This outlook mirrors the forecasts being issued for other U.S. cities, as well. The general consensus is that real estate markets across the country could begin to cool down in 2022. Of course, “cooling” is a relatively term. Within the Salt Lake City housing market, a cooldown might meant that it goes from white-hot to just red-hot.
Disclaimer: This report contains real estate predictions issued by third parties not associated with the publisher. Such predictions are the equivalent of an informed guess and should be treated as such.