A new report from CoreLogic found that U.S. home prices have shown a significant rebound in July 2023, rising by 2.5% year over year. This resurgence follows two successive months with an annual gain of 1.6%.
This upward trend reflects a six-month continuous spike, pushing prices roughly 5% above the lowest figures reported in February. Notably, 11 Western states observed a decline in home prices. These decreases, however, could be temporary, given the prevailing inventory shortages in many of those markets. CoreLogic anticipates that these states will transition to a growth phase, reporting positive year-over-year figures by Oct. 2023, buoyed by heightened buyer competition.
“Annual home price growth regained momentum in July, which mostly reflects strong appreciation from earlier this year,” said Selma Hepp, chief economist for CoreLogic. “That said, high mortgage rates have slowed additional price surges, with monthly increases returning to regular seasonal averages. In other words, home prices are still growing but are in line with historic seasonal expectations.”
Hepp added: “Nevertheless, the projection of prolonged higher mortgage rates has dampened price forecasts over the next year, particularly in less-affordable markets. But as there is still an extreme inventory shortage in the Western U.S., home prices in some of those markets should see relatively more upward pressure.”
Key Insights Include:
- A 0.4% month-over-month rise in U.S. home prices (considering distressed sales) from June 2023 to July 2023.
- The annual appreciation rate for attached properties in July stood at 3%, outpacing detached properties by 0.6 percentage points.
- CoreLogic projects an escalation in U.S. home price gains to 3.5% by July 2024.
- Miami took the lead among 20 metro areas, registering a 9% year-over-year home price ascent in June, followed by St. Louis at 4.8%, and Detroit at 4.5%.
- Statewise, Vermont saw the highest annual appreciation in July, surging by 8.5%. New Hampshire and New Jersey followed closely, each with a 7.3% increase. Conversely, states like Idaho, Nevada, and Montana led the declining trend with decreases of 5.7%, 4.2%, and 3.6% respectively.
