After months of waning homebuyer demand, the total value of U.S. homes at the end of 2022 was down 4.9% ($2.3 trillion) from June’s record high of $47.7 trillion to $45.3 trillion in December. Though U.S. home values were up 6.5% from a year earlier in December, the median U.S. home sale price was $383,249 in January, down 11.5% from a May peak of $433,133 and up just 1.5% from January 2022, Redfin reports.
San Francisco took the biggest hit to regional home values with a 6.7% year-over-year decline to $517.5 billion in December, a $37.3 billion drop, and the Golden Gate City was followed by two other Bay Area metros: Oakland (-4.5%) and San Jose (-3.2%).
Pricey coastal tech hubs have experienced outsized declines in home values for a few reasons:
- They are among the most expensive markets in the country, which means home values had more room to fall.
- They have seen an exodus of residents during the pandemic because people prioritized space and affordability over proximity to the workplace.
- They were hit hard by tech layoffs and are home to many residents with significant investments in the stock market, which just had its worst year since 2008. (It’s worth noting that many laid-off tech workers are finding new jobs quickly.)