Today, CoreLogic released its Home Price Index (HPI) and HPI Forecast for February 2022, revealing that U.S. home prices saw a year-over-year increase of 20%, marking another series high and 12 consecutive months of double-digit gains.
Although prospective buyers heavily outweigh sellers in today’s housing market, the primary culprit for rapid price gains are the record low number of homes for sale. Yet, the CoreLogic HPI Forecast shows national year-over-year appreciation slowing to 5% by February 2023 as interest rates climb, sidelining even more buyers.
”New listings have not kept up with the large number of families looking to buy, leading to homes selling quickly and often above list price,” Dr. Frank Nothaft, chief economist at CoreLogic, said. “This imbalance between an insufficient number of owners looking to sell relative to buyers searching for a home has led to the record appreciation of the past 12 months. Higher prices and mortgage rates erode buyer affordability and should dampen demand in coming months, leading to the moderation in price growth in our forecast.”
In February, annual appreciation of detached properties (21.1%) was 4.8 percentage points higher than that of attached properties (16.3%).
Florida is quickly becoming the hottest housing market in terms of price growth. Naples, Florida recorded the highest year-over-year home price increase at 41.4%. Cape Coral Florida ranked second with a 40% year-over-year increase. All four metro areas with the largest annual price gains in February are on Florida’s Gulf Coast. Meanwhile, two metros in upstate New York posted the lowest home price increases in the country with Ithica at 5.2% growth and Elmira at 3% growth.
CoreLogic’s data displays a strong trend at the state level; warmer regions of the country show the largest increases in price growth. Florida had the strongest price growth at 29.1%, Arizona ranked a close second at 28.6%, and Nevada was third at 25.8% annual appreciation.
