Lost Price: All of the 60 Largest Metros Experience Declines in Home Prices as Longest Boom Ends, San Jose Leads with a 15.5% Price Decline from its Peak

WASHINGTON, Dec. 22, 2022 /PRNewswire/ -- The Nation's longest home price boom has ended after a run-up lasting 10½ years. Nationally, prices have declined 3.1% from the peak in June, according to data from the American Enterprise Institute's (AEI) Housing Center. While all 60 largest metros have begun experiencing year-on-year price declines, San Jose, Seattle, and San Francisco have led the way with declines of 15.5%, 13.4%, and 12.7% from their respective peaks (see #1 in graphic below).

(1) Map of Year-on-Year HPA. (2) Map of Month-on-Month HPA displaying change from peak prices. (3) Month's supply by price tier.

The Nation's longest home price boom has ended after 10½ years- San Jose leads the way with a 15.5% decline.

November's Year-on-Year HPA was 6.7%, down from 8.5% a month ago, a YoY peak of 18.3% in March 2022 and 16.7% a year ago. Based on Optimal Blue rate lock data, YoY HPA is projected to decline further to 5% in December 2022 and 3% in January.

YoY HPA varied significantly among the 60 largest metros. It ranged from 2.6% and 5.8% in San Francisco and San Jose to 17.8% and 15.0% in Miami and North Port (see #2 in graphic).

Historically, HPA in the low price tier outpaced HPA in the upper price tiers. This trend continues to hold true. Although home prices were down across all four price tiers, the high end and low end of the market were hit differently. In November, high price tier was down 4.6% from its peak in May 2022, while low price tier was down 3.1% from its peak in July.

November's months' supply & active listings both increased above seasonal trends, but remain at historically low levels. Months' supply stood at 2.5 months in November 2022, down from 3.0 months in November 2019, but up from 2.1 months in October 2022, and 0.9 months in May 2022 (see #3 in graphic). The months' supply for the high price tier came in at 6.2 months in November 2022, helping the price weakness for this tier.

The AEI Housing Center provides the most advanced and timely information on home prices available. Measures of home price appreciation like the Case Shiller index have months of lag, meaning the most recent numbers are for September. The Housing Center has published data for November, and with Optimal Blue rate lock data is able to accurately project December 2022 and January 2023 as well.

Link to National Home Price Appreciation (HPA) Index – November 2022

Media Contact Details:

Sissi Li
American Enterprise Institute Housing Center
Washington, DC
aei.org/california-housing-conference
Sissi.Li@aei.org
412-596-2265