Value of housing market in the US increased at its fastest pace for four years
The total value of all homes in the United States is now $31.8 trillion, having risen $2 trillion in 2017, new data shows.
Overall, the cumulative value of the nation’s housing market grew at its fastest annual pace for four years at 6.5%, according to the latest figures from real estate firm Zillow.
It means that the housing market has gained $9 trillion since the lowest levels of the recession and the value gained in 2017 alone is equivalent to more than the valuation of two companies the size of Apple.
The Los Angeles and New York housing markets each account for more than 8% of the value of all housing and are worth $2.7 trillion and $2.6 trillion, respectively. San Francisco is the only other housing market worth more than $1 trillion.
Among the 35 largest markets, Columbus grew the most in 2017, up 15.1% while San Jose, Dallas, Seattle, Tampa, Las Vegas and Charlotte in North Carolina also grew by 10% or more over the past year.
‘This was a record year for home values as the national housing stock reached record heights in 2017. Strong demand from buyers and the ongoing inventory shortage keep pushing values higher, especially in some of the nation’s booming coastal markets,’ said Zillow senior economist Aaron Terrazas.
‘Renters spent more than ever on rent this year, but the amount they spent grew at the slowest pace in recent years as more renters transitioned into home ownership and new rental supply slowed rent growth across the country,’ he explained.
‘Despite recent changes to federal tax laws that have historically made home ownership financially attractive, the long term dynamics pushing up home values and rents are unlikely to change significantly in 2018,’ he added.
The report also shows that tenants spent a record $485.6 billion in 2017 on rent, an increase of $4.9 billion from 2016. Those in New York and Los Angeles spent the most on rent over the past year. These markets are also home to the largest number of renter households.
San Francisco rents are so high that renters collectively paid $616 million more in rent than Chicago renters did, despite there being 467,000 fewer renters in San Francisco than in Chicago.
Las Vegas, Minneapolis and Charlotte in North Caroline had the largest gains in the total amount of rent paid, with each increasing by more than 7% since 2016.