Data and analytics provider CoreLogic released its housing trends wrap-up for 2022 and it underscores the radical shift that happened over the course of a year.
The report found that year-over-year home-price growth increased for the 130th straight month in November. However, gains slowed since spring: appreciation tapered off every month since April 2022 and fell to 8.6% in November.
Even despite this, homeowners were in positive-equity territory throughout the first three quarters of 2022, and foreclosure rates remain low.
“The wild ride known as the U.S. housing market slowed dramatically in the fall of 2022, as mortgage rates surged and home prices remained high,” said Molly Boesel, principal economist at CoreLogic.
Home equity growth was steady
The growth in home prices contributed to home-equity gains, the report says. Almost two in three American homeowners with a mortgage gained an average of $64,000, according to CoreLogic’s Home Equity Report.
In the first three months of 2022, borrowers gained a total of $3.8 trillion in home equity since Q1 of 2021, an increment of 32.2%. In Q3 of 2022, homeowners gained a total of $2.2 trillion in equity and an average of $34,300 per borrower, showing an increase of 15.8% since Q3 2021.
Home-price growth reached record highs and then declined
Home price growth reached 20.1% year over year in April 2022, the highest in more than 20 years, but appreciation had fallen to 8.6% by November.
Sun Belt states, especially Florida, experienced high home-price gains, owing to migration from expensive areas on the west coast.
Spiking interest rates — which ranged from 3.22% in early January to 7.08% in mid-November — moderated home-price growth.
CoreLogic says the decrease in homes for sale, strong mortgage underwriting standards and high unemployment rates have kept the housing market “relatively healthy, making a major downturn unlikely.”
Mortgage performance was healthy
According to CoreLogic’s Loan Performance Index, mortgage delinquencies also dropped for the 19th consecutive month in October. Foreclosure rates were also low, with 0.2% in February and continuing at 0.3% through October.
With 99% of borrowers locked in to low mortgage rates, homeowners were able to avoid late payments or defaulting on their loans.
Rental prices relaxed toward the end of 2022
Rental prices reached single digits in October for the first time since June 2021, according to CoreLogic’s monthly Single-Family Rent Index. The year-over-year rent growth slowed to 8.8% in October, a decline from 13.9% in spring 2022.
Rents increased the most since January 2022 in Florida, especially in Miami and Orlando.