Home price increases weakened sharply in November, posting the smallest annual gain in 2 years – By Diana Olick (CNBC) / Jan 3, 2023
- Higher mortgage rates and consumer worries are hitting home prices.
- Prices are now 2.5% below the spring 2022 peak and are expected to continue to move lower this year.
- Mortgage rates are back on the rise again after a brief reprieve in November and early December.
Home prices are falling into a deep winter chill, as higher mortgage rates push more buyers to the sidelines.
Prices in November were still 8.6% higher than during the same month in 2021, but it was the first year-over-year reading in single digits in 21 months, according to CoreLogic. It is also the lowest rate of appreciation since November 2020.
Prices are now 2.5% below the spring 2022 peak and are expected to continue to move lower this year. CoreLogic’s forecast has price movement falling into negative territory by spring before rebounding to about 2% to 3% growth in the fall.
“Although home price growth has been slowing rapidly and will continue to do so in 2023, strong gains in the first half of last year suggest that total 2022 appreciation was only slightly lower than that recorded in 2021,” said Selma Hepp, deputy chief economist at CoreLogic. “However, 2023 will present its own challenges, as consumers remain wary of both the housing market and the overall economic outlook.”
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