Us property prices at 2005 levels
Las Vegas, where prices have risen by one of the largest amounts in the last year Photo credit: Moyan Brenn
US home prices edged up in August by 0.5 per cent month-on-month, according to Zillow's latest Home Value Index. The site's data reveals that the average US home value is now $175,600, 6.6 per cent higher than the same month 2013.
"The last time national home values were at this level was in March 2005," explains Stan Humphries, Zillow's Chief Economist.
Among the nation’s 35 largest metros, all but Indianapolis experienced year-over-year home value increases in August. Those metro areas with the most notable annual increases include Miami-Fort Lauderdale (16.6 per cent), Las Vegas (16.3 per cent), Riverside (16.2 per cent) and Atlanta (15.5 per cent), all metro areas where home values remain well below peak levels. For example, Miami-Fort Lauderdale, Las Vegas and Riverside each currently have median home values more than 30 percent below peak values.
Indeed, 282 out of the 515 metro areas monitored by Zillow have home values more than 10 per cent below their peak levels, indicating there is room to grow and the recovery will continue over the next few years.
While many markets are still experiencing above-normal rates of home value growth, though, annual growth is slowing down. Indeed, price increased are forecqast to slow further in the coming 12 months, with a projected rise of 3.1 per cent through August 2015.
Rents also climbed 3.3 per cent on an annual basis in August, growing at an increased annual pace compared to the previous month since May, a trend which Zillow labels "somewhat troubling... given that rents are already unaffordable in most major metro areas".
Annual rent growth was led by San Jose (16.2 per cent), San Francisco (14.9 per cent), Pittsburgh (12.6 per cent) and Denver (10.1 per cent).
According to the August Zillow Buyer-Seller Index, seller’s markets are located generally on the West Coast, while areas where buyers have more negotiating power are in the Midwest and the Northeast.