US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

US Housing Market Predicted to Remain Strong in 2022

The US housing market has seen impressive levels of growth over the past two years. Even as the COVID-19 pandemic affected the US economy, Americans remained highly interested in buying homes – as indicated by the high levels of home sales and the record-low levels of available homes for sale. After a year and a half of above average activity, many in the industry wonder if this pace is sustainable. A series of recent articles indicates it can.

According to one report, single-family housing starts will remain over one million units in 2022 and 2023. While growth in this key segment will be modest over the next two years, this level of new home building is still more than 25% over that of 2019. Multifamily housing starts are forecast to advance more rapidly – over 6% in 2022. In both the single- and multifamily housing segments, builders will continue to capitalize on strong demand for new housing and years of underbuilding, which has thousands of potential homeowners looking for residences in vain.

Housing prices will also remain high over the next year or so, due to:

  • the shortage of available units
  • rising costs for key raw materials, particularly lumber and plastic products, such as siding and windows and doors
  • a shortage of labor across construction and the skilled trades

Home builders remain optimistic about the market amid these conditions. Nearly all builders report that they will build more homes in 2022, even in the face of rising prices and shortages of key materials. To offset this, home builders are increasingly using software to better manage projects and minimize downtimes, as well as specifying prefabricated components to reduce delays at the construction site.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia Custom Research is also available for questions requiring tailored market intelligence.