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Zillow: West Coast Home Sellers Cashing In on Record Home Values
Remember that bungalow in Portland you could have bought 20 years ago? Too bad.
Zillow Inc., Seattle, said home sellers in the West Coast’s hottest cities, including Portland, Oakland and Seattle, are not only making the biggest investment of their lives–they’re also getting the best returns. Nationwide, Zillow said home sellers in 2016 sold for 24 percent more than what they initially paid, after living in it for roughly seven and a half years, earning $40,000 on average.
But in Oakland, Zillow said the typical seller in 2016 sold their home for an average of $590,000 after living in it for just over seven years–78 percent more than what they initially paid. In Portland, the typical 2016 seller sold for $145,000 more than what they paid nine years earlier, a 65 percent gain.
On Tuesday, CoreLogic, Irvine, Calif, reported home prices rose by nearly 7 percent year over year in July, with highest percentage growth in Pacific Northwest states. It reported Seattle home prices rose by nearly 13 percent from a year ago.
“Low inventory and strong demand are driving up home values in these popular markets, making it difficult for aspiring buyers to find a home, but providing a good opportunity for homeowners looking to sell,” said Zillow Chief Economist Svenja Gudell.
Other cities with highest returns on sales were San Jose, Calif. (56.5% return); Denver (56%); Los Angeles (53.7%); Sacramento, Calif. (53.6%); Seattle (53.1%); Philadelphia (51.7%); New Orleans (51.5%); and Boston (49.6%).
The housing market recovery has sent home values roaring higher in the past several years, especially in West Coast cities that are attracting people with well-paying jobs. Despite the opportunity to cash in on record-high home values, some homeowners choose not to sell because they don’t want to become buyers in a competitive market.
“Every city on this list has been growing extremely fast over the past decade, with the majority passing peak home value hit during the housing bubble,” Gudell said.
Among Zillow’s top 10 list, three cities have home values growing in the double-digits. In Seattle, home values rose 15.5 percent year over year, the fastest growing among the list, followed by Boston and Sacramento.