Property prices in the 35 largest metros across the United States saw double digit growth year on year while supply of homes for sale has fallen by 3% compared to a year ago.
The latest data from real estate firm Zillow shows that Tampa and Orlando in Florida, Seattle, and Dallas had the biggest growth. In Tampa prices were up almost 12% to a median value of $182,100.
Home values in both Seattle and Dallas were up 11% in the 12 months to February 2017 and the Zillow report says that high buyer demand along with fewer homes for sale is driving home values higher in many of these markets.
Nationwide the median value was $195,700, the highest since June 2007 and there were 3% fewer homes for sale while in Tampa supply was down by 5% and Orlando there were 11% less homes on the market than a year ago.
Indeed, many places with rapidly rising home values have inventory shortages in the double digits. In Seattle, for example, home values are up 11% but the selection of homes is down 10.5%.
Minneapolis, Cincinnati and Detroit reported the greatest drop in supply since last February with a fall of 18% in Minneapolis and 15% in Cincinnati.
Zillow reckons that millennials will have a big impact on this year’s home shopping season as they start aging into homeownership, especially in booming job markets that are attractive to young home buyers.
‘Low inventory, strong demand and tough competition will be the defining characteristics of this year’s home shopping season,’ said Zillow chief economist Svenja Gudell.
‘Even though interest rates are rising, buyers are eager to start their home search. If you’re a prospective buyer about to enter the market, keep in mind that it’s rare to get the first home you make an offer on, and homes in particularly hot markets frequently sell for over asking price,’ she explained.
‘Buyers should give themselves enough time to get their finances in order and find a real estate agent they know and trust before jumping into the market,’ she added.
In the lettings market median rents nationally were up 1.2% year on year in February to a median of $1,406 per month. Seattle, Portland and Sacramento reported the highest year on year rent appreciation among the 35 largest US housing markets.
Rents in Seattle were up 7% to $2,100 per month while rents in both Portland and Sacramento grew by 5%.
