Key Details:
- CoreLogic has released its 2023 Home Price Insights report with analysis through December 2022 and forecasts through December 2023.
- Nationwide home prices for December 2022, including distressed sales, increased by 6.9% year over year and dropped by 0.4% month over month.
The CoreLogic 2023 Home Price Insights report is now live with the latest market analysis through December 2022 and forecasts through December 2023.
The purpose of the CoreLogic HPI is to give an early indication of home price trends using national, state, and metro-level market data.
According to its latest report, nationwide home prices for December 2022 increased by 6.9% year over year and dropped by 0.4% month over month.
The CoreLogic Home Price Insights (HPI) Report
CoreLogic HPI Forecasts™ project HPI levels for two single-family property tiers:
- Single-Family Combined (both Attached and Detached), and
- Single-Family Combined excluding distressed sales
Reports are monthly and include home price indices (including distressed sales), as well as home price forecasts and market condition indicators. Data for the report incorporates 40+ years of repeat-sales transactions to provide a comprehensive analysis of home price trends.
Home Price Insights (HPI) up to January 2023
Nationwide home prices for December 2022, including distressed sales, increased by 6.9% compared to December 2021.
As shown on the map above, only eight of the 50 states experienced double-digit home price increases in December 2022, down from 48 states in April of the same year.
The states with the highest home price increases year-over-year:
- Florida (15.3%)
- Vermont (13.5%)
- South Carolina (12.2%)
Month-over-month, home prices dropped by 0.4% in December 2022 (compared to November 2022).
At the metro level, the following map shows the large cities still experiencing home price increases in November 2022, with Miami holding the number one spot at 19.5% year-over-year.
The CoreLogic Market Risk Indicator (MRI), which provides a monthly update on the general health of housing markets across the U.S., predicts the following metros are at a very high risk (70%-plus probability) of a home price decline over the next 12 months:
- Salem, OR
- Bellingham, WA
- Bremerton–Silverdale, WA
- Crestview–Fort Walton Beach–Destin, FL
- Olympia–Tumwater, WA
The HPI Forecast™ through December 2023
The CoreLogic HPI Forecast™ points to a month-over-month home price decline of 0.2% from December 2022 to January 2023 and a year-over-year price drop of 3% from December 2022 to December 2023.
In 2022, the cooling effect of rising mortgage rates on buyer demand resulted in a 6.9% drop in annual home price growth at the end of the year—down from April’s high of 20% appreciation.
The impact of unemployment and returning to the office
According to the U.S. Bureau of Labor Statistics, the national unemployment rate in December 2022 remained at a low 3.5%.
But recent layoffs, particularly in the technology sector, may be convincing more buyers to back away from the market in some expensive metro areas.
San Francisco and Seattle, for example, posted significant deceleration in home prices last November, according to the latest CoreLogic S&P Case-Shiller Index. The only state to register an annual loss in December 2022 was Idaho, with a 1% drop in home prices, compared to its 17% increase recorded in April of the same year.
The evidence trickling in suggests that, as more of the U.S. workforce returns to the office, the pandemic-fueled migration to suburban, exurban, and rural neighborhoods may be slowing.
The continued slowing of home price growth at the end of 2022 reflects a more pessimistic outlook on the housing market and on the economy in general, with elevated mortgage rates, high home prices, and inflation making it harder for more people to afford a home purchase.
And with a significant share of would-be sellers still deterred by mortgage rates higher than the ones they currently have locked in, fewer of them are listing their homes.
So, while home prices in December 2022 continued to fall, compared to the previous month, the rate of decline was lower than it was last summer and still amounts to a mere 3% cumulative drop in home prices since last spring’s peak.
Some exurban regions that became increasingly popular during the COVID-19 pandemic saw prices jump and affordability erode at the time, but these areas are now seeing major corrections. And while price deceleration will likely persist into the spring of 2023, when the market will probably see some year-over-year declines, the recent decrease in mortgage rates has stimulated buyer demand and could result in a more optimistic homebuying season than many expected.
Top takeaways for real estate agents
Home price data, insights, and forecasts should all be in your resource folder as tools for staying on top of any developments in the housing market that could impact buyers and homeowners in your area.
Anything that can help you make sense of what’s really happening in your market can make you a better resource for your clients and community. When they ask whether it’s a good time for them to buy or sell, you want to be able to back up your convictions with undeniable data.
And with industry-leading resources like CoreLogic and Keeping Current Matters (KCM) putting that data at your fingertips, you no longer have an excuse not to provide the data your clients need to make smart decisions.
