The US housing market has lost $2.3 trillion in value from its peak as home prices tumble

• US homes lost 4.9% of their value from a 2022 peak, equating to $2.3 trillion, according to a report from Redfin.
• That's the largest June-to-December drop in percentage terms since 2008.

The US housing market has lost $2.3 trillion in value from a 2022 peak as sale prices crashed, according to a report from Redfin.

That equates to a 4.9% decline, marking the largest June-to-December drop in percentage terms since 2008.

Overall US home values totaled $45.3 trillion at the end of last year. While that's up 6.5% from December a year earlier, that's the smallest year-over-year increase since August 2020.

Redfin cited weakening demand as the Federal Reserve's monetary tightening campaign helped send mortgage rates to a 20-year high of 7.08% in November.

The lower demand sent home prices tumbling. The median US sale price was $383,249 in January, down 11.5% from a peak of $433,133 in May.

"The housing market has shed some of its value, but most homeowners will still reap big rewards from the pandemic housing boom," Redfin Economics Research Lead Chen Zhao said in a statement. "The total value of U.S. homes remains roughly $13 trillion higher than it was in February 2020, the month before the coronavirus was declared a pandemic."

But "a lot of people were left behind," she added. "Many Americans couldn't afford to buy homes even when mortgage rates hit rock bottom in 2021, which means they missed out on a significant wealth building opportunity."

On Tuesday, the National Association of Realtors said the US housing market could be close to bottoming out, as existing home sales hit the lowest level since 2010.

Sales slipped 0.7% in January to a seasonally adjusted rate of 4 million units a year, representing the 12th straight month of declines and a 36.9% dive from a year ago.

For now, prices remain above year-ago levels. The median existing-home price for all housing types in January was $359,000, an increase of 1.3% from the same month in 2022.

Meanwhile, other market commentators have warned the US housing market is on the verge of a crash akin 2008.