Zillow’s April, 2017 Real Estate Market Report reports that for the first time in over a decade, home values have returned to peak, pre-recession values. Today’s nation-wide median home value is now $198,000., 1% higher than the peak value in April, 2007. Additionally, Zillow’s Home Value Index (ZHVI) tells us that this $198,000. median home value has increased 7.3% over last year’s $196,000. This too is the strongest rate of appreciation in 10 years.
Looking more deeply into these numbers, hyper-localism matters. Among the 32 largest U.S. metro markets, ten of those markets saw median home values exceed prior bubble peaks. Seattle leads the pack with an increase of almost 12% and median home value of $432,300. Tampa and Dallas aren’t far behind with a 11% year over year increase. On the other hand, 17 among the 32 largest metro markets in the U.S. have yet to regain their peak value price points.
A glaring detail to pay attention to in Zillow’s latest statistical offerings is the number of homes on the market this year as compared to last. Nationally, there are 8% fewer homes on the market this year than last. Again, hyper-localism matters. Minneapolis and Columbus are tied for last place with 27% fewer homes and Seattle is third with 20% less inventory. These first, second, and third place rankings are not the kind you’d want to be recognized for.
Rents around the country are also up over this past year. Nation-wide, rents are $1,412./monthly, up 0.7% over last year, Some cities are experiencing even higher rents over last year with Seattle and Sacramento leading the pack with a 5% increase and Los Angeles with a 4% increase.
In looking at these numbers, some may say we’re heading towards a national housing bubble. Not so, says Dr. Svenja Gudell, Zillow’s chief economist. “There are big differences between the market then and now. Then, loose credit, speculation and over building were the ingredients in a recipe for disaster. Now, healthy home buyer demand is being driven largely by a stable economy and demographic trends…supply has been slow to catch up to this demand which is causing home values to grow at a faster clip than we might otherwise have expected…” Dr. Gudell goes on to say in closing, “Americans clearly continue to see the value in homeownership, especially young Americans, which bodes well for the future.”