PROVIDENCE – The Rhode Island home price index increased 10.4% year over year in October, slightly higher than the national growth rate of 10.1%, CoreLogic Inc. said on Tuesday.
Rhode Island’s HPI growth rate was the third highest in New England, with Vermont leading the region at 14.5%.
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The report found that although home price growth remained in double digits in October it continued to cool and was the lowest recorded since early 2021. Several factors contributed to slowing appreciation: Low inventory due to seller preferences to keep affordable mortgage rates that they have already locked in, homebuyer loss of purchase power and current economic uncertainty.
Annual U.S. price growth is expected to taper off in the coming months, perhaps moving into negative territory by spring 2023, but then slowly ticking back into single digits as the year progresses, according to the report.
“Following the recent mortgage rate surge above 7%, real estate activity and consumer sentiment regarding the housing market took a nosedive,” said Selma Hepp, interim lead of the Office of the Chief Economist at CoreLogic. “Home price growth continued to approach single digits in October, and it will move in that direction for the rest of the year and into 2023.
“However, while some housing markets have seen significant recalibration since the spring price peak and are likely to post losses in 2023, further deteriorating for-sale inventory, some relief in mortgage rate increases and relatively positive economic news may help eventually stabilize home prices,” Hepp said.
The year-over-year growth rate of the home price index in other New England states:
- New Hampshire 11%
- Maine: 10.3%
- Connecticut: 9.5%
- Massachusetts: 7.3%.
