There’s a split emerging in the U.S. housing market: Some are becoming more valuable than ever, while others struggle to emerge from the financial crisis.
More than half of the homes nationwide are now more valuable than their pre-recession peaks, according a report released Thursday by real-estate website Zillow ZG, +4.21% The national median home value is now $217,300, an increase of 8.3% on the year and 8.4% above the bubble-era peak. In 21 of the nation’s 35 largest markets, the median home value is now at an all-time high.
Driving much of the home value appreciation nationwide is a reduction in the number of homes available on the market. Inventory contracted 4.8% over the past year. Indeed, the tight supply of homes for sale has contributed to what some have called the most competitive home buying season on record.
Some markets have rebounded faster than others post-recession. In seven of the country’s largest housing markets — Dallas-Ft. Worth, Seattle, Denver, San Antonio, San Jose, Austin and Portland, Ore. — more than 95% of homes are worth more than the pre-housing boom peak.
Denver has experienced a particularly notable rebound: The median value is now $397,700, or 65.5% higher than its previous peak in 2006, and more than 99% of homes are more valuable than they were in the bubble years.
|Metropolitan area||Share of homes worth more than pre-recession peak||Median home value (June 2018)||Year-over-year change in home value|
|New York, N.Y.||28.5%||$429,300||6.7%|
|Los Angeles-Long Beach-Anaheim, Calif.||64.4%||$646,300||7.6%|
|Dallas-Fort Worth, Texas||97.7%||$229,400||11.6%|
|Miami-Fort Lauderdale, Fla.||9.6%||$272,900||7.7%|
|San Francisco, Calif.||85.8%||$953,600||11%|
|Minneapolis-St. Paul, Minn.||61.3%||$261,300||7.6%|
|San Diego, Calif.||63.4%||$583,700||6.6%|
|St. Louis, Mo.||51.3%||$161,400||5.5%|
|San Antonio, Texas||98.8%||$185,000||5.6%|
|Kansas City, Mo.||71.6%||$181,400||9.2%|
|Las Vegas, Nev.||0.8%||$264,300||15%|
|San Jose, Calif.||98.7%||$1,287,600||27.2%|
But almost the opposite is happening in Las Vegas, where less than 1% of homes are worth more than their pre-recession peak. “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,” Zillow senior economist, Aaron Terrazas, wrote in the report.
Meanwhile, renters are faring somewhat better these days, according to Zillow. The median rent nationwide only increased 1.3% over the past year to $1,440, marking the second straight month in which rent appreciation has fallen below the overall rate of inflation.
For those renters who are looking to buy homes in the near future, that’s certainly welcome news, as it can now take years to save up enough for a down payment thanks to the breakneck pace of home price appreciation.