In accordance with the ongoing slump in home sales and mortgage application volume, the Federal Finance Housing Agency (FHFA) reported annual and fourth-quarter declines in U.S. home purchase and refinance appraisals in its Q4 update of the Uniform Appraisal Dataset (UAD) Aggregate Statistics Data File and Dashboards.
Nationally, the median appraised value for single-family properties dropped from $394,000 in 2022 to $390,000 in 2023 – still, a 36% increase from $286,000 in 2019, per FHFA data.
Compared to the third quarter, the number of appraisals for purchase and refinance loans combined decreased by 20.7% in the fourth quarter of 2023, a quarter-over-quarter decline consistent with appraisal activity from the third to fourth quarters of 2022. The FHFA reports that “each year since 2013, the number of fourth-quarter purchase appraisals has declined compared to the previous quarter, dropping 20.4%, on average.”
Purchase loans, specifically, experienced a 22.6% decline from the third quarter, and refinance loans posted a 14.7% decline. Year over year, the number of appraisals decreased 9.6% for purchase loans and 4% for refinance loans from the fourth quarter of 2022, an 8.2% decrease combined.
Fourth-quarter purchase loans experienced a 1% annual increase in median appraised value, with New Jersey (+10.8%), Vermont (+10.5%) and New York all seeing notable annual increases.
Washington, D.C. (-6.9%), Texas (-3.6%) and Utah (-2.8%) held the top three spots that saw the greatest annual declines in median appraised value.
The slight annual increase in median appraised value nationally was moderated by a quarterly drop of 0.3% at the end of 2023, with mostly midwestern states experiencing the largest quarterly declines: Vermont (-6%), Michigan (-5.9%), Iowa (-4.6%), Wisconsin (-4.5%), Illinois (-4.1%) and Minnesota (-4%).
The median appraised value for fourth-quarter refinance loans increased on both a quarterly (+4.9%) and annual (+3.2%) basis, nationally. Besides New Mexico (+14.3%), the largest year-over-year increases were generally concentrated in the Northeast: Connecticut (+14.1%), New York (+13.6), New Jersey (+13.3%), New Hampshire (+12.6%), and Vermont (+11.4%).
Meanwhile, the largest quarter-over-quarter increases were more dispersed across the country, led by New York (+11.1%), North Dakota (+9.9%) and Alaska (+8.8%).
Though midwestern states experienced some of the largest quarterly declines in median appraised value for purchase loans, many of these states experienced quarterly increases in median appraised value for refinance loans, such as North Dakota (+9.9%), Kansas (+8%), Wyoming (+6.7%) and Illinois (+4.7%).
