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WFG Founder and Executive Chairman Patrick Stone shared his thoughts on the economy and the housing market in 2022 during the second edition of October Research’s Economic Series Forecast Webinar.

Stone began by reviewing the upbeat forecasts for the economy made as the new year approaches.

“It looked like we were going to have a good market again, maybe a little less than in 2021, but most forecasts were that we would see something like a 2-5% drop in sales, refis would drop maybe 25%, that mortgage rates would stay below 4% and inflation would start to come down,” he said. “Well, we had a little change, and that was the geopolitical issue with Russia invading Ukraine.”

The impact of the conflict is far-reaching, Stone said, raising mortgage rates, increasing inflation and, depending on how long the conflict lasts, causing many unknowns.

“Where this is really going to hurt and affect us all is on low income households and particularly on starter home purchases because low income people who are buying starter homes will not be able to participate. at the level we had anticipated because they ‘have had a real and meaningful impact on their revenue,’ he said.

On the other hand, millennials entering the age of household formation are the largest group ever, larger even than baby boomers, Stone said.

“We have a tremendous amount of potential first-time buyers that are going to happen over the next three to five years,” he said. “If we get back to a normal economy, that will really manifest itself in a recovery of hospitality homes and first-time buyers.”

For more on Stone’s analysis, including whether he thinks we’re in a housing bubble and whether we’re headed for a recession, as well as his tips for dealing with market unpredictability, listen to his webinar 30 minutes here. Thanks to the sponsorship of SoftPro, it’s free.