New Insurify Report Reveals Housing Market Trends

Falling home values, upside-down mortgages, and climate change worries are rewriting how homeowners navigate the real estate market.

With the Federal Reserve raising its benchmark interest rate nine consecutive times in the past 12 months, the housing market has begun to cool in many areas across the country. The Federal Funds rate — the interest rate banks charge each other for overnight lending — now sits at just under 5%.

Homeowners with adjustable rate mortgages (ARMs) and potential homebuyers are likely to find escalating interest rates most burdensome. Meanwhile, home sellers may find their properties sitting on the market for weeks or months longer than comparable homes did just a year ago.

But homeowners have even more on their minds than rising interest rates and falling home values, a recent Insurify poll discovered. They’re also worried about making their mortgage payments and how climate change will affect their home values in the future.

Home values in the West are declining

The year-over-year upward trajectory of home values slowed by 15% in 2022. And while home prices still rose an average of 11% overall last year, certain western states actually saw home values begin to decline in the last six months of the year.

The tech implosion and the ability to work remotely in more affordable locations are driving devaluation in states that previously had robust markets, says Susan M. Wachter, a professor of real estate and finance at the Wharton School of the University of Pennsylvania. However, Watcher says, there’s likely good news.

Are home values declining too quickly?

Susan M. Wachter

Susan M. Wachter


Albert Sussman Professor of Real Estate, Professor of Finance at the Wharton School of the University of Pennsylvania, Wharton School of the University of Pennsylvania

“[Depending on the future of the economy], I do not expect prices to decline precipitously across the U.S. as a whole.”

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StateHome Value Depreciation (June-Dec. 2022)
District of Columbia-3%

Home buying in major metro areas is slowing down

As inflation ballooned and mortgage rates rose, home buying slowed in many major metropolitan areas across the country. Even in cities that had the most home sales in 2022 — like New York, Chicago, Miami, Atlanta, and Philadelphia — the rate of home buying was down substantially from the year before.

While home buying declined more than 23% in those cities, Winston and Greensboro, both in North Carolina, saw the largest drops — 59% and 58%, respectively.

Cities with the most home sales

Metropolitan areas in the West saw some of the sharpest drops in home buying, making up more than 50% of the cities with the largest drops from 2021 to 2022. Namely, Las Vegas, Provo, San Jose, Seattle, and San Diego saw the biggest declines, at an average drop of around 30%.

CityDrop in Home Buying 2021–2022
Winston, NC-59%
Greensboro, NC-58%
Wichita, KS-41%
Albany, NY-36%
North Port, FL-34%
Milwaukee, WI-34%
Las Vegas, NV-32%
Provo, UT-32%
San Jose, CA-31%
Chicago, IL-30%
Seattle, WA-30%
Bridgeport, CT-30%
San Diego, CA-29%
Los Angeles, CA-29%
Riverside, CA-29%
San Francisco, CA-29%
Tucson, AZ-29%
Salt Lake City, UT-28%
Stockton, CA-28%
Austin, TX-28%

New homeowners are already upside down on their mortgages

Insurify polled Americans across the country to learn their greatest homeownership concerns. Of those polled, 69% shared varying degrees of concern about becoming upside down on their mortgages. Of that group, 31% say they already owe more than the houses are worth.

Overall, a quarter of all respondents are already upside down on their mortgages.

Despite concerns over negative equity, 68% of new homeowners who bought their houses within the past 12 months said they think they bought at the right time, but 25% wished they’d bought sooner.

Important Information

Home values are a significant factor in home insurance rates. Higher home values typically equate to higher insurance premiums.

Homeowners fear climate change will drive devaluation

More than three-quarters of poll respondents expressed varying degrees of concern that climate change could affect their home values in the future. And nearly 45% said it already has.

While lower housing prices historically mean lower home insurance rates, that’s likely not the case in areas already affected by climate change.

In fact, homeowners who live in areas at high risk of natural disasters like floods, hurricanes, and wildfires pay nearly 2.5 times more for home insurance than those who live in low-risk areas, according to Insurify’s analysis of Quadrant home insurance rates and FEMA’s assigned risk ratings. Annual home insurance premiums rise $24 for every 1-point increase in a county’s FEMA risk index score (scaled 0–100).

Climate change contributes to increasing prices in high risk areas.

Sam Eckhouse

Sam Eckhouse


Principal of ClimateCheck, ClimateCheck

“As we see a higher frequency of climate-related catastrophic events — wildfires, storms, floods, etc. — insurers will have no option but to price in the increased risk. That means higher insurance premiums for homeowners, especially if they live in a high-risk area and they have not taken steps to mitigate the risk of damage or loss.”

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More Americans are moving south — mainly to Texas and Florida

The millions of Americans who migrated south in 2022 likely drove home buying in states like Texas and Florida — the two states that saw large population increases last year. Attractive weather and relatively affordable housing and living conditions have likely contributed to southward migration.

“The South has become the ‘Great Attractor’ of the newly mobile population,” Wachter says.

States with the most increases in population

More than 1.3 million Americans moved to southern states between 2021 and 2022, an increase of 1.1%. Meanwhile, despite historically higher home prices, Florida had the biggest percentage increase in its population, with a 1.9% increase. The following table shows the 10 states with the most population growth.

States with the largest decreases in population

People moving south had to come from somewhere, and some northern states marked statistically significant population losses. In fact, overall the Northeast saw a total population decline of 0.4%.

New York had the biggest population drop, at 0.9%. Interestingly, the second-largest decline was in Louisiana, at 0.8% — the only southern state to see its population shrink in 2022. The following table shows the states with the largest population decreases in 2022.

State2021 Population2022 PopulationPercentage Loss
New York19,857,49219,677,1510.9%
West Virginia1,785,5261,775,1560.6%

Get more insights on real estate, homeownership, and home insurance

Insurify’s Insuring the American Homeowner report examines trends in homeownership, home values, and home insurance throughout 2022 and forecasts what could be ahead in 2023. The report examines how climate change is shaping the American home buying and home insurance markets, and homeowners’ insurance experiences, concerns, and claims.

The report is available to download for free.

Insuring the American Homeowner 2023

Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content

Evelyn Pimplaskar is Insurify’s director of content. With 30-plus years in content creation – including 10 years specializing in personal finance – Evelyn’s done everything from covering volatile local elections as a beat reporter to building fintech content libraries from the ground up.

Before joining Insurify, she was editor-in-chief at Credible, where she launched and developed the lending marketplace’s media partnership’s content initiative and managed the restructuring of the editorial team to enhance content production efficiency. Formerly, as tax editor for Credit Karma, Evelyn built a library of more than 300 educational articles on federal and state taxes, achieving triple-digit year-over-year growth in e-files from organic search.

Her early career included work as a content marketer, vice president and managing officer of a boutique public relations agency, chief copy editor for 14 weekly Forbes publications, reporting for large and mid-sized daily newspapers, and freelancing for the Associated Press.

Evelyn is passionate about creating personal finance content that distills complex topics into relatable, easy-to-understand stories. She believes great content helps empower readers with the information they need to make important personal finance decisions.