It's fair to say that 2022 has been quite the year for the real estate market. Early on, would-be buyers were in a really tough spot. The housing market sorely lacked inventory, and home prices went through the roof.

Over the past few months, though, the available inventory on the market has ticked upward and home prices have started to retreat. But for buyers, the benefits of those shifts have been offset by rising mortgage rates and increasing uncertainty about future borrowing costs in light of additional planned rate hikes on the part of the Federal Reserve.

Whether you're a real estate investor or an everyday person hoping to buy a home, it's important to know what to expect from the housing market during the latter part of 2022. Here's what we could be in for during the year's final quarter.

The outside view of a house.

Image source: Getty Images.

1. Housing inventory is likely to increase

In July, the inventory of unsold homes on the market sat at 1.31 million, the National Association of Realtors reported. That represented a 3.3-month supply based on the pace of sales at that time.

Now, that was progress compared to January. Back then, there were just 860,000 available homes for sale. But a 3.3-month supply of homes isn't truly enough supply to meet buyer demand. For that to happen, it generally takes a minimum of a 4-month supply, and that's really on the low end.

Still, because more progress was made on the inventory front over the summer, it's fair to assume that the supply of available homes will continue to increase. Sellers are fully aware that economists have been sounding recession warnings, and also, that benchmark rate hikes on the part of the Federal Reserve could push more buyers out of the market. They're likely to act on that by listing their homes sooner rather than later.

Meanwhile, as inventory continues to climb, home prices should start to come down. And that could give buyers more opportunities.

2. Expect home sales to slow down

In July, the National Association of Realtors reported that existing-home sales fell for the sixth month in a row. July sales numbers were down 5.9% from the previous month and 20.2% from the previous year.

Home sales could continue to slow down as buyers back away due to recession fears or get spooked by higher mortgage rates. But to be clear, one big reason home sales have declined is that there hasn't been a lot of inventory to go around. So sellers don't need to panic too much about a housing market recession.

3. Borrowing could get more expensive

The Federal Reserve is not done making moves to fight inflation -- far from it. As such, we're likely to see additional federal funds rate hikes come down the pike this year, which should, in turn, drive mortgage rates upward.

This isn't to say that buyers should expect mortgage rates to rise drastically. To put it another way, we're not looking ahead to people paying 8% or 10% on a 30-year mortgage -- rates that would have been common during the 1980s and early 1990s. But might a 30-year loan reach 6.5% (near the high end of the range where rates sat for most of the 2000s) by the end of 2022? It's a possibility.

Let's wait and see

Ultimately, these predictions are just that -- predictions. While they're based on known factors like real estate inventory changes and home sales numbers, they're not guaranteed to happen. But if you're looking to buy a home, they are definitely factors you'll want to keep tabs on to gauge whether it pays to pounce in 2022 or wait it out and see what 2023 brings.