It seems that 2022 will likely be a good year to be in the credit reselling business, as home sales to first-time buyers are expected to increase. This is because house price increases will level out over the next twelve months, at least according to Realtor.com.
Indeed, economists at Realtor.com are forecasting the slowest housing price increase on record since 2012, following one of the fastest housing price increases in history. The median home price in 2022 is expected to only increase by 2.9% over the next twelve months; in the twelve months between September 2020 and September 2021, it increased 19.6%
Obviously, lower price growth offers home buyers, particularly first-time home buyers looking for a primary residence, a bit of wiggle room. There will be less bidding and competition, more time to search for homes, and more homes available.
“After years of declining, the inventory of homes for sale is finally expected to rebound from all-time lows,” Realtor.com’s economists predicted.
An Interest in Interest Rates
Ok, so why are home price increases going to slow down? It’s a relatively simple answer, really: inflation.
In case you haven’t noticed, inflation is an increasingly big deal these days (pun intended), hitting its highest point in over 40 years.
This means that the Federal Reserve is going to increase interest rates, a natural and common response to inflation. Early forecasts project the current 3.1% average 30-year rate climbing to 3.6% by the end of 2022.
That may not seem like a lot, but it is. It puts downward pressure on housing prices, decreasing demand by pushing some potential buyers out of the market. Over time, this counterintuitively makes homes more attainable for people who were frozen out previously–recall that much of the housing crunch has come from venture capitalists buying properties as investments, not as residences.
With home price increases slowing and interest rates climbing, this will no longer be a winning gambit.
TrendSource OnSite Inspections for Consumer Reporting
All of this amounts to an accelerating housing market, where supply better matches demand and housing prices finally stop their seemingly fantastical upward trend.
And an increase in home sales to first-time buyers, of course, means more mortgages, and more mortgages mean more credit checks. For credit resellers already making a killing on refinances, their happy days are likely to continue and only get better.
Yet the only way to capitalize on the bonanza is to ensure continued compliance with the Fair Credit Reporting Act. And that is where TrendSource can help.
TrendSource has long been a premier provider of OnSite Inspections, documenting companies’ compliance with the federal regulations governing consumer reporting. TrendSource’s OnSite Inspections are accepted by all three major credit bureaus (Equifax, Experian, and TransUnion) and can be executed either in-person or virtually.
They can even be ordered online.
TrendSource has a proven track record of rapidly, accurately, and professionally executing OnSite Inspections for Consumer Reporting. And, if our suspicions about the 2022 housing market are correct, this will be more important than ever.
