U.S. Home Prices Are Falling for the First Time Since 2012

For 124 consecutive months, from February 2012 to June 2022, the seasonally adjusted Case-Shiller National Home Price Index posted positive home price growth, but for the last four months, U.S. home prices have fallen. Since peaking in June, home prices are down 2.4%, and while that may seem like a small drop, it’s the second-largest home price correction of the post–World War II era, according to Fortune.

The U.S. housing market has been correcting since spring 2022, when the Federal Reserve started applying upward pressure on interest rates to tame inflation. With more rate hikes on the horizon, the housing market is on track to see an even bigger slowdown in home prices throughout 2023, experts say.

Heading forward, Moody's Analytics chief economist Mark Zandi expects home sales to bottom out here pretty soon. However, he foresees that it will take until at least 2024 before home prices bottom out.

"Housing demand [home sales] is close to a trough; housing supply [housing starts and completions] has yet to hit bottom; and house prices have a way to go before reaching their nadir," Zandi tells Fortune.

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