United States Housing Market Trends & Statistics, 2022

Housing prices continue to rise across the United States, with the median selling price of American homes cresting $389,000 in February 2022. Meanwhile, rent prices have rebounded from pandemic lows, and are now rising at the remarkable rate of 17.1% annually as inflation surges across the country.

Below, we’ll dig into some of these trends in more detail as we present key figures pertaining to residential and commercial real estate.

Housing Market Trends & Statistics

1. Median Home Sale Price Tops $389,000, up 16.1% Year-Over-Year

Since many housing markets in the United States are seeing prices increases, the median home sale price is also rising. Between February 2021 and February 2022, prices rose by 16.1% year-over-year, reaching a median selling price sat at $389,520.

[Source: Redfin]

2. Total Home Sales Fall by 6.1% Year-Over-Year

While prices are steadily moving up, sales numbers declined. Between February 2021 and February 2022, there was a 6.1% year-over-year decrease, with 414,726 homes sold in February 2022 compared to 441,458 in February 2021.

[Source: Redfin]

3. National Housing Inventory Level Sits at 6.1 Months

Monthly supply inventory (MSI) outlines how long it would take for the current housing inventory that’s actively on the market to sell. In most cases, a six-to-seven-month supply represents stability, with prices leveling out as demand and supply achieve balance. If the inventory levels fall below six months, it’s a seller’s market. Figures above seven months signal a buyer’s market.

When viewed nationally, the MSI of homes in the United States is considered stable. As of January 2022, the inventory levels were 6.1 months, putting it broadly in the area of balanced.

However, individual markets can see dramatically different numbers. For example, Los Angeles sits at 1.2 months, and Atlanta is at 0.9 months.

[Source: Realtor.com, Federal Reservice Economic Data St. Louis FED, Norada Real Estate Investments & Norada Real Estate Investments]

4. Home Sales Outpace Pre-Pandemic Levels, Hitting a High of 6.12 Million in 2021

While housing prices have primarily trended upward, existing home sales actually grew throughout the pandemic. In some cases, higher price points encouraged sellers while lower interest rates enticed buyers. Couple that with buyers’ changing needs due to working from home or providing more care to children during school closures, and the motivation to move was there for many.

Overall, existing home sales measured in at 5.34 million in 2019. However, in 2020, it actually rose to 5.64 million, further increasing to 6.12 million in 2021. During 2022, estimates suggest a total near 5.95 million, causing all three years to exceed pre-pandemic levels.

In fact, the last time sales exceeded those three years occurred in 2006, well before the Great Recession. That year, sales reached 6.52 million.

[Source: Statista]

5. Forecast Anticipates Home Value Growth of 16.4% in 2022

While forecasts often shift as the year progresses and experts may announce different figures due to the use of varying data sources, home value increases are almost universally anticipated. Some data suggests that growth rates for 2022 will hit 16.4%.

[Source: MarketWatch]

Rent Market Trends & Statistics

6. Rent Prices Rising 17.6% Year-Over-Year

In the United States, rents have largely risen during 2021 and into 2022. As of March 2022, the year-over-year increase hit a startling 17.6%.

The biggest part of the surge occurred during the Spring of 2021. That was a period when rising vaccine rates and traditional moving windows began causing people to return to cities or seek out larger homes to accommodate working from home long-term.

However, even between November 2021 and February 2022, rents rose by 0.7%. While that’s pretty modest, it’s a higher rate than is typically seen during those months.

[Source: Apartment List]

7. Rents Increase in 74 of the 100 Largest Cities in the Country in February 2022

For those living in bigger cities, rent increases are largely the norm currently. In February 2022, 74 out of the 100 largest cities in the United States saw rents rise.

While increases are impacting 74 cities spread all across the country, specific areas are seeing the fastest growth. Overall, the Sun Belt is outpacing many other regions, particularly in-demand places like Phoenix and Miami.

[Source: Apartment List]

8. Rental Prices for Single-Family Homes Rose by 7.8% in 2021, Reaching an All-Time High

Those looking for single-family homes to rent in 2021 often had a much harder time finding well-priced properties. The demand for larger houses – partially spurred by the increase in remote work – outpaced supply in many areas.

As a result, rental prices for single-family homes skyrocketed, increasing by 7.8% on average in 2021, a figure that may represent an all-time high. Additionally, in highly competitive markets, rents grew far more. For example, year-over-year increases in Miami hit 35.7% in December 2021.

It’s important to note that these figures are lower than the total rent increases, as the metrics separate single-family homes from apartments. Often, apartment rentals are more commonly seen in high-cost downtown areas, potentially positioning them for larger increases than you may find in the outskirts of cities or surrounding suburbs.

[Source: Bloomberg]

9. Rent Prices Expected to Rise in 2022, Leading to an Average Increase of 3.6%, According to Forecasts

Forecasts suggest that rent prices are going to rise broadly across the United States. Annual rent growth in 2022 is expected to reach 3.6% on average across major cities in the United States.

Areas with lower cost-of-living that also qualify as fast-growing markets are likely to see the most significant price surges. Phoenix may see prices rise by 7.6%, while Las Vegas could reach 7.0%.

In contrast, high-cost areas that people left during the pandemic may see more modest increases. For instance, Long Island may be limited to a 2.7% increase, while Central New Jersey may come in closer to 2.3%.

Inflation and demand increases are largely behind the cost movement. With inflation, landlords often raise rates to offset increasing costs. Similarly, when demand outpaces supply, rents typically increase.

[Source: Fox Business]

Commercial Real Estate Market Trends & Statistics

10. Industrial Rents Rise by a Historic 8.4% as Vacancy Levels Reach Record Lows

During the pandemic, shopping online became the go-to method for many households and businesses. As a result, demand for industrial property skyrocketed. With the increased competition for space in 2021, rents rose a historic 8.4%.

Additionally, the increase in demand led to plummeting vacancy rates. Overall, vacancy rates hit record-setting lows, sitting at a mere 4.1%

[Source: National Association of Realtors]

11. Retail Vacancy Rates Remain Steady at 4.6%

Brick-and-mortar retail was hard hit during the pandemic. In some cases, shelter-in-place orders, stricter occupancy limits, and mask mandates steered people away from physical stores. However, this didn’t lead to a notable change in retail vacancy rates overall.

In 2019, the vacancy rate in the United States was 4.5%. During the pandemic – in 2020 and 2021 – the rate hit 4.9%. As for 2022, it’s estimated at 4.6%, moving it back toward pre-pandemic levels.

[Source: Statista]

12. Office Space Vacancy Rates Hit 12.5% in Early 2022

The main segment of the commercial real estate industry that’s struggling to regain footing is office space. Many companies that transitioned to work-from-home models during the pandemic don’t intend to return to traditional workplaces, either at all or to the same levels.

The decision to continue supporting remote work means far less leased office space is needed overall. As of early 2022, vacancy rates sat at 12.5%.

[Source: National Association of Realtors]

Bottom Line

While the early days of the pandemic led to broad price declines and rising vacancy rates in many areas, the circumstances causing that are predominately gone. Home values and rental prices are rising and will likely continue to do so while demand remains high and inflation stays a factor.

On the commercial side, only office rental space is still feeling the pinch. That may continue well beyond 2022, particularly if working from home becomes a standard part of the paradigm.