Housing Market ‘Will Soon Favor Buyers’
The median home value in the U.S. rose to $191,200 in October, up 6.2 percent from a year ago, said Zillow, Seattle, adding that a survey of analysts predict the housing market will shift from the current seller’s market to a buyer’s market by late 2018/early 2019.
The company’s Real Estate Market Report said rents rose by 1.4 percent over the past year to an average of $1,402.
The report noted home values across the country have been rising for more than four years. “Due to low inventory, prospective buyers often face intense competition,” Zillow said. “Less than half of buyers are successful in purchasing the first home they make an offer on.”
Zillow reported 6 percent fewer homes for sale across the country than a year ago, with Boston, Indianapolis and Kansas City reporting the greatest drop in inventory among the 35 largest U.S. metros. Boston saw 26 percent fewer homes to choose from than a year ago, while Indianapolis reported 24 percent fewer homes for sale.
Despite unfriendly market conditions for buyers, housing experts predict things will change in the near future–the majority of experts surveyed in the latest Zillow Home Price Expectations Survey said they expect the housing market to shift from a seller’s market to a buyer’s market in 2018 or 2019. Zillow forecasts home values to slow to a 3 percent appreciation rate by next October.
“The housing market has been favoring sellers for the past few years,” said Zillow Chief Economist Svenja Gudell. “Sellers in the current housing landscape often have the luxury of listing their home ‘as-is’ without fixing it up or with only minimal window-dressing since demand for homes has been high and inventory low. It’s common for sellers to receive multiple bids, and in the hottest markets, sell for over asking price, but these conditions will change in the future. As the number of homes for sale increases and home value appreciation slows, we expect the market to meaningfully swing in favor of buyers within the next two to three years.”
Zillow said Portland, Dallas and Seattle reported the highest year-over-year home value appreciation among the 35 largest metros across the country for the third month in a row. Home values in Portland rose by nearly 15 percent to a median value of $349,500. Dallas and Seattle home values have appreciated just over 12 percent since last October.
Seattle, Portland and Sacramento reported the highest year-over-year rent appreciation among the 35 largest U.S. housing markets. Rents in Seattle are up by 9 percent to $2,087. Rents in Portland and Sacramento rose by 7 and 6 percent, respectively.
