Annual US Home Price Growth Rebounds in July, CoreLogic Reports

• U.S. home price gains moved up to 2.5% year over year in July, marking the 138^th consecutive month of annual growth.
• Eleven states saw home price declines on an annual basis in July, ranging from -5.7% in Idaho to -0.3% in California.
• Miami continued to post the largest gains of the top 20 tracked U.S. metro areas, at 9%, followed by St. Louis (4.8%) and Detroit (4.5%).
• 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).
• CoreLogic projects that year-over-year U.S. home price gains will reach 3.5% by July 2024.

CoreLogic®, a leading global property information, analytics and data-enabled solutions provider, today released the CoreLogic Home Price Index (HPI^™) and HPI Forecast^™ for July 2023.

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Figure 1: HPI and HPI Forecast Percentage Change Year-Over-Year (Graphic: Business Wire)

U.S. home price gains rebounded year over year in July, increasing to 2.5% and following two months of 1.6% annual gains. The annual reacceleration reflects six consecutive monthly gains, which drove prices about 5% higher compared to the February bottom. The 11 states that saw home price declines were all in the West, but since many of those markets continue to struggle with inventory shortages, that trend may be short-lived, and recent buyer competition will causes prices to heat up again. CoreLogic 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:

• 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.
• 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%).
• 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%).

The next CoreLogic HPI press release, featuring August 2023 data, will be issued on October 3, 2023, at 8 a.m. EST.

Methodology

The CoreLogic HPI^™ is built on industry-leading public record, servicing and securities real-estate databases and incorporates more than 45 years of repeat-sales transactions for analyzing home price trends. Generally released on the first Tuesday of each month with an average five-week lag, the CoreLogic HPI is designed to provide an early indication of home price trends by market segment and for the Single-Family Combined tier, representing the most comprehensive set of properties, including all sales for single-family attached and single-family detached properties. The indices are fully revised with each release and employ techniques to signal turning points sooner. The CoreLogic HPI provides measures for multiple market segments, referred to as tiers, based on property type, price, time between sales, loan type (conforming vs. non-conforming) and distressed sales. Broad national coverage is available from the national level down to ZIP Code, including non-disclosure states.

CoreLogic HPI Forecasts^™ are based on a two-stage, error-correction econometric model that combines the equilibrium home price—as a function of real disposable income per capita—with short-run fluctuations caused by market momentum, mean-reversion, and exogenous economic shocks like changes in the unemployment rate. With a 30-year forecast horizon, CoreLogic HPI Forecasts project CoreLogic HPI levels for two tiers — Single-Family Combined (both attached and detached) and Single-Family Combined Excluding Distressed Sales. As a companion to the CoreLogic HPI Forecasts, Stress-Testing Scenarios align with Comprehensive Capital Analysis and Review (CCAR) national scenarios to project five years of home prices under baseline, adverse and severely adverse scenarios at state, metropolitan areas and ZIP Code levels. The forecast accuracy represents a 95% statistical confidence interval with a +/- 2% margin of error for the index.

About Market Risk Indicators

Market Risk Indicators are a subscription-based analytics solution that provide monthly updates on the overall health of housing markets across the country. CoreLogic data scientists combine world-class analytics with detailed economic and housing data to help determine the likelihood of a housing bubble burst in 392 major metros and all 50 states. Market Risk Indicators is a multi-phase regression model that provides a probability score (from 1 to 100) on the likelihood of two scenarios per metro: a >10% price reduction and a ≤ 10% price reduction. The higher the score, the higher the risk of a price reduction.

About the Market Condition Indicators

As part of the CoreLogic HPI and HPI Forecasts offerings, Market Condition Indicators are available for all metropolitan areas and identify individual markets as overvalued, at value or undervalued. These indicators are derived from the long-term fundamental values, which are a function of real disposable income per capita. Markets are labeled as overvalued if the current home price indexes exceed their long-term values by greater than 10% and undervalued where the long-term values exceed the index levels by greater than 10%.

Source: CoreLogic

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About CoreLogic

CoreLogic is a leading global property information, analytics and data-enabled solutions provider. The company's combined data from public, contributory and proprietary sources includes over 4.5 billion records spanning more than 50 years, providing detailed coverage of property, mortgages and other encumbrances, consumer credit, tenancy, location, hazard risk and related performance information. The markets CoreLogic serves include real estate and mortgage finance, insurance, capital markets, and the public sector. CoreLogic delivers value to clients through unique data, analytics, workflow technology, advisory and managed services. Clients rely on CoreLogic to help identify and manage growth opportunities, improve performance and mitigate risk. Headquartered in Irvine, Calif., CoreLogic operates in North America, Western Europe and Asia Pacific. For more information, please visit www.corelogic.com.

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