Home prices edged slightly lower in the U.S. in December 2022, marking the sixth consecutive month of falling housing prices as the challenging macroeconomic environment reduced buyer appetite. The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index fell by 0.3% month over month.

Despite home prices declining in the second half of 2022, the U.S. National Home Price index was up 5.8% year over year during the month, weaker compared to the index's 7.6% year-over-year increase in November 2022.

"The prospect of stable, or higher, interest rates means that mortgage financing remains a headwind for home prices, while economic weakness, including the possibility of a recession, may also constrain potential buyers," said Craig Lazzara, managing director at S&P Dow Jones Indices.

Miami gets top spot in home price increases

Housing price increases continued to slow in all 20 cities covered in the 20-City Composite index, which posted a year-over-year rise of 4.6% compared to 6.8% in the previous month.

The 10-City Composite index increased 4.4% year over year, weaker than the 6.3% rise seen in November 2022.

* Set email alerts for future Data Dispatch articles. * Read some of the day's top real estate news and insights from S&P Global Market Intelligence.

Among the biggest gainers across all 20 covered cities, Miami maintained its top spot with an annual home price increase of 15.9%. Tampa, Fla., was second on the list, with a 13.9% year-over-year price gain, while Atlanta took the third spot with a 10.4% increase in home prices during December 2022.

Homebuilder stocks mixed

U.S. homebuilder stocks were mixed, with the median one-year total return at 0.8% as of Feb. 27.

Taylor Morrison Home Corp. continued to be the top-performing company in the homebuilding sector, posting a one-year total return of 19.9%. The company sold 12,647 homes over the 12 months prior to Dec. 31, 2022, a 7.7% decrease from the year-ago period.

New single-family home sales in the U.S. increased 7.2% month over month to a seasonally adjusted annual rate of 670,000 units in January, but were down 19.4% on an annual basis, according to data from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.

The South was the only region to have a monthly increase in sales of new single-family homes.

Homes sales are bottoming out as lower-priced regions experience modest growth and more expensive areas see declines, National Association of Realtors Chief Economist Lawrence Yun said in a Feb. 21 research note.

"Inventory remains low, but buyers are beginning to have better negotiating power," Yun said.

Existing home sales fell month over month and year over year in January, declining 0.7% from the previous month and 36.9% from a year ago, according to the National Association of Realtors.

Listed homes sitting idle in the market for over 60 days can be bought for about 10% lower than the original listing price, according to Yun.