Half of All U.S. Homes More Valuable than Pre-Recession Peak
Ten years after the Great Recession, half of the country’s homes have regained the value they lost during the recession, said Zillow Inc., Seattle.
The company’s monthly Real Estate Market Report said nationwide, the median home value rose to $217,300, up by 8.3 percent over the past year and by 8.4 percent above the highest point of the housing bubble. The median home value has surpassed its bubble peak level in 21 of the nation’s 35 largest housing markets.
Zillow said in places that have seen some of the strongest growth since the market crashed, nearly every home is now more valuable than it was during the boom years. In Denver, the typical home is worth $397,700, 65.6 percent higher than its highest point in June 2006. In that market, 99.6 percent of all homes are worth more than they were during the bubble.
In seven of the 35 largest U.S. housing markets, more than 95 percent of homes are worth more than their peak value during the housing boom
“Even a decade after the 2008 Financial Crisis, and five-plus years into the recovery, it’s clear that the housing boom and bust was felt very differently in various markets–and is still being felt today in many,” said Zillow Senior Economist Aaron Terrazas.
However, the report noted while half of the country’s homes have regained all of their lost value, several markets are still trailing in the housing recovery. Despite strong median home-value growth in recent months in Las Vegas–home values have grown at a double-digit pace for 15 consecutive months–less than 1 percent of homes there have fully recovered from the housing bust.
“In markets like Las Vegas that got farthest ahead of themselves during the boom, and consequently fell the most, a large majority of homes are still not worth as much today as they were a decade ago,” Terrazas said. “But in markets like Denver that were more stable a decade ago, many more homes are worth more now than ever before. Despite widespread and consistent home value growth today, the scars of the recession still run deep for millions of longer-term U.S. homeowners, and it may take years of growth for their home to regain the value lost a decade ago. And while stabilizing growth in rents is likely a relief for those renters saving to become homeowners, many of those would-be buyers in a number of the nation’s hottest markets will be contending with home prices that are as high as they’ve ever been.”
The report said rents rose at a 1.3 percent pace over the past year to a median of $1,440. Rent appreciation has slowed nationwide for four straight months and has now been below the overall rate of inflation for two consecutive months.
Zillow said Riverside, Calif., and Sacramento, Calif., saw the greatest annual rent increases among the nation’s largest metros, with rents growing by more than 5 percent in each market.
Zillow said limited supply of homes for sale continues to challenge home shoppers. Inventory fell by 4.8 percent from a year ago, although the pace of the decline has slowed considerably. In June 2017, inventory was falling at a 12.3 percent annual pace. Atlanta saw the biggest annual decline in inventory, falling 15.7 percent from June 2017.
