According to an analysis of Redfin estimates on more than 99 million U.S. residential properties, the total value of U.S. homes was $45.3 trillion at the end of 2022.
Sounds like a lot, right? Well, total values of U.S homes peaked at a record high of $47.7 trillion back in June of last year.
This means that since the peak in June, American homeowners have collectively lost $2.3 trillion in the value of their homes. To put this into perspective, $2.3 trillion is roughly equivalent to the GDP of Texas in 2022. Texas has the second largest economy by GDP in the U.S., after California.
The peak to what is currently (and hopefully) a trough is the largest June-to-December drop in percentage terms since the 2008 housing market crash.
Redfin said that the decrease in the value of U.S. homes is attributed to the declining demand from homebuyers, leading to the falling prices of homes. While those homeowners have recently seen steep losses, new companies have innovated ways for them to hedge against a loss in home value.
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Median home sale prices were $383,249 in January, down 11.5% from a peak of $433,133 in May.
Florida’s housing market, however, has been holding value relatively well compared to other metropolitan areas.
The total value of homes in Miami rose 19.7% year over year to $468.5 billion in December, marking the largest annual increase in percentage terms among the metros analyzed by Redfin.
Millennials, who are currently in their prime home-buying age, have reaped significant value gains, with the total value of homes owned by millennials rising 26.7% year over year to $5.6 trillion in the third quarter of 2022.
Gen-X and Baby Boomers have also seen significant increases in total home value, while the Silent Generation has seen a decrease in home value.
Further, despite the rise in natural disasters, the value of homes in places that face high risk from climate change has remained the same or has increased, due to factors including increased interest in owning coastal property and the fact that climate risk may not yet fully be priced into the market.
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