Mortgage News February 17, 2023
Home price growth and appreciation both decreased significantly in December 2022 according to CoreLogic Home Price Index (HPI) and HPI Forecast.
Home prices grew 6.9% in December, down from a series high of 20% appreciation in April, as more homeowners became aware of the impact of rising mortgage rates on housing demand in 2022. Compared to 48 states that recorded double-digit gains in April, only nine states recorded double-digit year-over-year price gains in December.
The US Bureau of Labor Statistics reports that unemployment remained low in December at 3.5%, but layoffs may be impacting housing demand in some expensive metro areas, especially those heavily dependent on the tech sector. San Francisco and Seattle posted significant decelerations in home prices in November, according to CoreLogic S&P Case-Shiller. As compared with its 17% gain in April 2022, Idaho was the only state to report a 1% loss in home prices in December (-1%). Yet, part of the U.S. workforce may gradually return to offices as a result of the pandemic-induced migration to suburban, exurban, and rural areas.
Selma Hepp, the chief economist at CoreLogic, said that increasing mortgage rates and a more pessimistic economic outlook are the primary causes of the continued slowdown in home prices at the end of 2022. In spite of the continued decline in prices from November, the rate was less than in the summer, and the cumulative loss from spring’s peak still amounts to only 3%.
When prices soared and affordability declined during the COVID-19 pandemic, some exurban regions saw major corrections, says Hepp. Despite some year-over-year price declines expected in spring 2023, the recent decline in mortgage rates has pumped buyer demand and may lead to a more optimistic home-buying season than many anticipated.
For any questions OR a sample of the records please submit the following form.