The index from the June real estate market report from Zillow shows that for the first time ever, the price of a typical home in the United States has gone over $200,000. The prices of homes are up 7.5% from the year ago period. Even during the height of the housing bubble over a decade ago, the median US home value peaked at $196,600 but never surpassed the $200,000 threshold until now.
The price of homes has shot up in the face of high buyer demand not matched by corresponding supply in the housing market. There are 11% fewer homes on the market than a year ago, the biggest drop in inventory since July 2013.
The index shows that national home values have been rising at over 7% year on year for the last five months, with a number of markets consistently witnessing double digit growth.
‘The national housing market remains red hot and shows no signs of slowing, even as some local markets like the Bay Area have noticeably cooled,’ said Zillow chief economist Svenja Gudell.
‘Even in areas where the housing market has slowed, home values are at or very near peak levels, selection is limited, demand is high and competition is fierce. Given these high costs and high competition, the most important thing buyers can do is get their finances in order so they know what is affordable,’ she added.
Markets witnessing the fastest rise in home values include Seattle, Dallas and Las Vegas. These areas reported year on year gains in double digits. In Seattle prices are up 13% to a median value of $447,100 while prices in Dallas and Las Vegas are up 10.5% and 10% respectively.
The greatest drop in inventory compared to last year has been reported from San Jose, Columbus, Ohio and San Diego. Homebuyers in San Jose now have nearly 40% fewer homes to choose from than a year ago, and there are 33% fewer in Columbus and San Diego.
The report also shows that median rent across the nation has been holding steady at about a 1% annual growth for the past six months, taking the median rent across the country to $1,422 per month.
Seattle, Los Angeles and Sacramento reported the greatest annual rent increases among the 35 largest US metros. In Seattle rents are up 5% to $2,142 per month, up 4.5% in Sacramento and up 4% in Los Angeles.
Median rents are falling in 12 of the 35 largest US metros, down the most in Pittsburgh with a fall of 4% and down 3% in Houston. Miami, San Jose and San Francisco are also among the metros where rent is cheaper this year than last.