Home Price Gains Find New Vigor

Good news for home price gains in July as gains rebounded year-over-year increasing by 2.5% following two months of gains that came in at 1.6%. This annual reacceleration now shows six consecutive monthly gains which drove prices about 5% higher compared to February’s trough. 

The 11 states that saw home price declines were all in the Western region of the United States, but since many of those markets have ongoing inventory issues—a trend that may be short lived—while recent buyer competition which will cause prices to heat up again. 

CoreLogic’s Home Price Index and Forecast projects that all states that saw year-over-year losses in July will begin posting gains by October of this year. 

“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.” 

“Nevertheless, the projection of prolonged higher mortgage rates has dampened price forecasts over the next year, particularly in less-affordable markets,” Hepp continued. “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.”

Top takeaways from the report as highlighted by CoreLogic include: 

• U.S. home price gains moved up to 2.5% year over year in July, marking the 138th consecutive month of annual growth. 
• U.S. home prices (including distressed sales) increased by 2.5% year over year in July 2023 compared with July 2022. On a month-over-month basis, home prices rose by 0.4% compared with June 2023. 
• In July, the annual appreciation of attached properties (3%) was 0.6 percentage points higher than that of detached properties (2.4%). 
• CoreLogic’s forecast shows annual U.S. home price gains increasing to 3.5% by July 2024. 
• The median sales price for a U.S. single-family home was $375,000 in July, led by California ($700,000), the District of Columbia ($670,000) and Massachusetts ($590,000). 
• Miami posted the highest year-over-year home price increase of the country's 20 tracked metro areas in June, at 9%. St. Louis saw the next-highest gain (4.8%), followed by Detroit (4.5%). 
• CoreLogic projects that year-over-year U.S. home price gains will reach 3.5% by July 2024. 
• Among states, Vermont ranked first for annual appreciation in July (up by 8.5%), followed by New Hampshire and New Jersey (both up by 7.3%). Eleven states recorded annual home price losses: Idaho (-5.7%), Nevada (-4.2%), Montana (-3.6%), Washington (-3.3%), Arizona (-2.9%), Utah (-2.8%), Oregon (-1.2%), Colorado (-0.6%), Texas (-0.6%), Wyoming (-0.5%) and California (-0.3%). 

Click here to read the report and forecast in its entirety.