Home prices in the Phoenix area increased a whopping 30.4% from February 2021 to the same month this year, according to the latest CoreLogic Home Price Insights report, but the outlook for the coming year is not nearly as strong.
CoreLogic predicts price increases to slow significantly by next spring in most metro areas, especially in Phoenix. It projects Phoenix-area home prices to rise just 3.2% by February 2023.
At the state level, Florida showed the largest price growth year over year at 29.1% followed closely by Arizona at 28.6%. Nevada was third at 25.8%.
CoreLogic HPI reviews data from 400 U.S. markets to show price changes year over year and month to month, and it also makes projections about where pricing is headed for the coming 12 months.
Nationally, home prices increased 20% in February compared to the same month in 2021. It’s the 12th consecutive month showing double-digit percentage growth from the previous year.
The CoreLogic HPI Forecast projects that growth to slow in 2022. It anticipates a 5% annual growth in home prices nationally by February 2023 as interest rate hikes drive away some buyers and temper some of the housing demand.
“New listings have not kept up with the large number of families looking to buy, leading to homes selling quickly and often above list price,” CoreLogic Chief Economist Dr. Frank Nothaft said in a news release. “This imbalance between an insufficient number of owners looking to sell relative to buyers searching for a home has led to the record appreciation of the past 12 months. Higher prices and mortgage rates erode buyer affordability and should dampen demand in coming months, leading to the moderation in price growth in our forecast.”