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The latest iteration of CoreLogic’s Home Price Index (HPI) for July 2022 showed the annual home price growth rate slowed for the third consecutive month in July yet remained in an elevated state at 15.8%.
This comes at a time when the 30-year, fixed-rate mortgage toes the 6% mark, forced some prospective buyers out of the market, thus helping ease “overhead and unsustainable price growth.”
Notably, according to CoreLogic, home prices declined by 0.3% from June to July of this year, a trend unseen between 2010-2019, when price increases averaged 0.5% between those two months based.
But looking ahead, CoreLogic expects to see a balancing market with year-over-year price appreciation slowing to 3.8% by July 2023.
“Following June’s surge in mortgage rates and the resulting dampening effect on housing demand, price growth is taking a decisive turn,” said Selma Hepp, Interim Lead of the Office of the Chief Economist at CoreLogic. “And even though annual price growth remains in double digits, the month-over-month decline suggests further deceleration on the horizon. The higher cost of homeownership has clearly eroded affordability, as inflation-adjusted monthly mortgage expenses are now even higher than they were at their former peak in 2006.”
Top Takeaways:
- U.S. home prices (including distressed sales) increased 15.8% year over year in July 2022, compared to July 2021. On a month-over-month basis, home prices declined by 0.3% compared to June 2022.
- In July, annual appreciation of detached properties (16.1%) was 1.5 percentage points higher than that of attached properties (14.6%).
- Annual U.S. home price gains are forecast to slow to 3.8% by July 2023.
- Once again, Tampa, Florida logged the highest year-over-year home price increase of the country’s 20 largest metro areas in July, at 29.7%, while Miami moved into the second slot at 27.1%.
- Florida and South Dakota posted the highest home price gains, 29.6% and 23.7% respectively. Tennessee ranked third with a 23.2% year-over-year increase. Washington, D.C. ranked last for appreciation at 2.4%.
