Home values were up 6.6% annually in August, the largest gain since July 2006, when home values rose 7.9% year on year.
National home values have risen or remained flat month on month for almost two years, though the pace of monthly home value appreciation has slowed in recent months. August marked the third consecutive month in which monthly home values rose more slowly than the month prior.
A majority, some 85%, of the 382 metros covered in August experienced annual home value appreciation. Among the 30 largest metro areas covered by Zillow, 20 saw annual appreciation of 10% or more.
Metros with notable annual increases in August include Sacramento where values were up 34.1%, Las Vegas up 30.6% and Riverside, California, up 29.7%.
For the 12 month period from August 2013 to August 2014, US home values are expected to rise another 5.2% to approximately $170,500, according to the Zillow Home Value Forecast.
Large metro areas expected to show the most appreciation over the next year include Riverside with a rise of 21.9%, Sacramento with a rise of 19.2% and Los Angeles with a rise of 13.2%.
‘August marked the end of one of the hottest summer home shopping seasons in years, as home value appreciation rates continued their rocket ride upward, perhaps dangerously so in some metro areas,’ said Zillow chief economist Stan Humphries.
‘Double digit appreciation rates do help to lift home owners out of negative equity and to entice sellers into a low inventory environment, but this rapid growth is not normal and cannot and should not be expected to last,’ he explained.
‘We are already beginning to see moderation in the monthly pace of home value appreciation, which will be good for the market overall and in the long term,’ he added.
National rents also rose in August compared with July, up 0.5% and up 1.9% year on year to a Zillow Rent Index of $1,293.
The number of completed foreclosures in August fell to 5.17 homes foreclosed out of every 10,000 homes nationwide, down from 5.27 homes in July. Foreclosure resale’s represented 8.28% of homes sold in the US in August, down 0.3% from July and 3.1% from August 2012.
