2021 was certainly a wild ride for real estate, and 2022 may have some new realities in store— including increasing interest rates and competition from foreign investors.

It’s no secret that 2021 has been a hot year for the real estate market. Houses are selling at record prices, bidding wars are frequently taking place for the limited inventory available, and it’s not unusual for buyers to pay for home purchases entirely in cash.

Though the market appears to be normalizing somewhat as more listings become available, 2022 is poised to have some unique issues and challenges of its own when it comes to real estate sales. Two factors in particular are likely to impact the market in the year ahead:

  • The Federal Reserve’s decision in November to scale back its pandemic-era economic stimulus efforts.
  • Foreign investment returning to the U.S. real estate market as American borders open.