An overwhelming majority of metropolitan-area markets saw home-price gains in the third quarter of 2022 despite mortgage rates that approached 7 percent and declining sales, according to the National Association of Realtors’ latest quarterly report, and the Washington region was no exception.
But there also were indications that home-price appreciation was beginning to cool as market conditions corrected to account for affordability issues and economic woes.
The national median single-family existing-home price climbed 8.6 percent from a year ago, rising to $398,500, according to figures reported Nov. 10. While still on the rise, the jump was well below the 14.2-percent year-over-year hike reported in the preceding quarter.
“Much lower buying capacity has slowed home-price growth, and the trend will continue until mortgage rates stop rising,” said NAR chief economist Lawrence Yun.
But there was still significant growth in many areas; 46 percent of the 185 tracked metro areas registered double-digit price increases, albeit a cooling from 80 percent in the second quarter.
For the Washington metropolitan area, the median sales price during the third quarter stood at $581,300, up 6 percent from a year before. The region frequently trails national rates of increase, but conversely tends to be more insulated from downturns.
Among the major U.S. regions, the South registered the largest share of single-family existing-home sales (44%) and the greatest year-over-year price appreciation (11.9%) in the third quarter. Prices rose 8.2 percent in the Northeast, 7.4 percent in the West and 6.6 percent in the Midwest.
Among the major U.S. regions, the South registered the largest share of single-family existing-home sales (44%) and the greatest year-over-year price appreciation (11.9%) in the third quarter. Prices elevated 8.2 percent in the Northeast, 7.4 percent in the West, and 6.6 percent in the Midwest.
The top 10 metro areas with the largest year-over-year price increases all recorded gains greater than 18 percent, with seven of those markets in Florida. They include North Port-Sarasota-Bradenton, Fla. (23.8%); Lakeland-Winter Haven, Fla. (21.2%); Myrtle Beach-Conway-North Myrtle Beach, S.C.-N.C. (21.1%); Panama City, Fla. (20.5%); Deltona-Daytona Beach-Ormond Beach, Fla. (19.6%); Port St. Lucie, Fla. (19.4%); Greenville-Anderson-Mauldin, S.C. (18.9%); Kingsport-Bristol-Bristol, Tenn.-Va. (18.8%); Tampa-St. Petersburg-Clearwater (18.8%); and Ocala, Fla. (18.8%).
Half of the top 10 most expensive markets in the U.S. were in California, including San Jose-Sunnyvale-Santa Clara, Calif. ($1,688,000; up 2.3%); San Francisco-Oakland-Hayward, Calif. ($1,300,000; down 3.7%); Anaheim-Santa Ana-Irvine, Calif. ($1,200,000; up 9.1%); Honolulu, Hawaii ($1,127,400; up 7.6%); San Diego-Carlsbad, Calif. ($900,000; up 5.9%); Los Angeles-Long Beach-Glendale, Calif. ($893,200; up up 3.8%); Boulder, Colo. ($826,900; up 7.5%); Naples-Immokalee-Marco Island, Fla. ($746,600; up 16.7%); Seattle-Tacoma-Bellevue, Wash. ($741,300; up 4.6%); and Boston-Cambridge-Newton, Mass.-N.H. ($698,900; up 6.2%).
“The more expensive markets on the West Coast will likely experience some price declines following this rapid price appreciation, which is the result of many years of limited home-building,” Yun said. “The Midwest, with relatively affordable home prices, will likely continue to see price gains as incomes and rents both rise.”
In the third quarter of 2022, stubbornly high home prices and increasing mortgage rates reduced housing affordability. The monthly mortgage payment on a typical existing single-family home with a 20-percent down payment was $1,840. This represents a marginal increase from the second quarter of this year ($1,837), but a significant jump of $614 – 50 percent – from a year before.