Home Prices Dropped in December Before Mortgage Rate Relief Arrived (December 2022 Market Report Preview)

• The typical U.S. home value fell slightly from November to December (-0.2%), as high interest rates further discouraged home buyers. U.S. home values are still 8.4% higher than a year ago.
• Seattle saw the sharpest home value decline month-over-month (-4.8%).
• Home values were lower than last December in Austin (-4.2%), San Francisco (-2.0%), Seattle (-0.6%), and San Jose (-0.0%). 
• Active inventory climbed to a 15.9% year-over-year increase in December.
• New listings sank 27.8% from last year’s flow of newly added listings.
• Newly pending listings only dropped 32.5% year-over-year – a large drop but somewhat less severe than the 38% year-over-year decline observed in November.
• Asking rents fell 0.3% month-over-month, a slightly smaller drop than in November but a bigger drop than is typical in December. The typical U.S. rent is now $1,981.

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Note: In September 2022, Zillow’s Economic Research team began releasing an early preview of our monthly market data, offering an accelerated first look at the previous month’s key housing metrics. More detail will be included later in the month in our standard full-length Monthly Market Report.