Is your glass half full, half empty, or overflowing?
- Half full: Pre-Covid homeowners have tremendous home equity, with prices rising 36% nationally in the last three years.
- Half empty: Home prices are down -3% from the April 2022 peak nationally through January 2023, with declines in 77% of the 150 largest markets.
- Overflowing: Prices have risen 55% in South Florida!
Here is the price change from peak 2022 levels by market.
Rising incomes, falling home prices, and moderating mortgage rates are the trifecta that should help ease affordability challenges—though changes to date are still not enough to reset affordability to typical levels.
- Markets in California, the Northwest, and Southwest have experienced the largest declines compared to peak 2022 levels, leading the substantial slowdown in housing demand and pricing that started on the West Coast and steadily flowed across the nation. The Southeast and Florida have experienced smaller declines to date.
- San Francisco and Austin have seen the largest declines—partly due to the tech boom and bust, with home prices falling -13% from peak 2022 levels.
- Markets in the Midwest and Northeast did not experience the same gang-busters price growth seen across the rest of the nation, helping buffer current home price declines.
- Robust in-migration and job growth continue to support home prices (less dramatic declines) in Florida and the Southeast, along with relative affordability, particularly for those migrating from higher-cost areas.
Despite these declines, resale home values remain 36% above pre-pandemic levels (Feb-2020) nationally.
- Across the 150 markets we track, resale home values have increased from 8% (San Francisco) to a whopping 76% (Naples) above pre-pandemic levels.
- Sunbelt markets (Florida, Southeast, Texas, and Southwest) experienced the strongest home price appreciation over the past three years, as many buyers fled high-cost metros in search of affordability and more space.
- Supply and affordability-constrained coastal California markets faced an urban exodus throughout the first 18 months of the pandemic. Combined with some of the largest price corrections to date, home values in these markets have erased a larger share of COVID-era gains.
As the market continues to evolve and change, we will keep our clients updated on key trends and insights to make the best investment decisions. To learn more about our research and consulting services, please fill out this form.
