CoreLogic, a global property information provider, is forecasting that home buyers are still ready to buy even as home-price appreciation peaked at its highest level in 45 years.
The CoreLogic Home Price Index released Tuesday found that consumers looking to purchase a home have remained optimistic moving into the new year, with more expecting to buy over the next six months as rapid home-price appreciation is forecasted to slow. Looking forward, home price gains are predicted to slow to 3.8% by January 2023.
Despite market and economic challenges — such as low inventory, continued buyer competition, and declining affordability — potential buyers are ready to move while mortgage rates remain relatively low.
"In December and January, for-sale inventory continued to be the lowest we have seen in a generation,” Chief Economist at CoreLogic Frank Nothaft, said. “Buyers have continued to bid prices up for the limited supply on the market. However, the rise in mortgage rates since January further eroded buyer affordability and is expected to slow price gains in coming months.”
Top Takeaways:
- Nationally, home prices increased 19.1% in January 2022, compared to January 2021. On a month-over-month basis, home prices increased by 1.4% compared to December 2021.
- In January, annual appreciation of detached properties (20.3%) was 5.1 percentage points higher than that of attached properties (15.2%).
- Home price gains are projected to slow to a 3.8% annual increase by January 2023.
- January marked the second consecutive month Naples (38.9%) and Punta Gorda (38.3%), Florida, logged the highest year-over-year home price increases.
- At the state level, the Mountain West and Southern regions continued to dominate the top three spots for national home price growth, with Arizona leading the way at 28.3%. Florida ranked second with a 27.9% growth and Utah followed in third place at 25.2%.
