Annual home value appreciation hit the 6 percent mark for the first time in nearly seven years in July, according to Zillow’s Real Estate Market Reports for the month.
The Zillow Home Value Index reached $161,600 in July, up 0.4 percent from June and an even 6.0 percent from July 2012. July marked the 14th straight month of annual home value gains.
“After three straight months of annual home value appreciation above 5 percent, the U.S. housing market recovery has proven it is on very sound footing,” said Zillow chief economist Dr. Stan Humphries. “We have entered a new phase in the recovery when we can begin to turn away from ugly recent history and turn toward what the housing market of the future will look like and how it will act.”
Despite these strides, however, Humphries noted that this is no time for policymakers and industry professionals to rest on their laurels.
“It may be tempting to look at how the market is currently performing and think that tackling GSE reform and other large issues is no longer necessary. But while we can afford to turn away from the recent past, we cannot afford to forget it, and simply ignoring these problems only dooms us to repeat them,” he said. “How we handle these all-important policy debates will be critical in keeping the housing market on sound footing for years to come.”
Of the 393 metros tracked in July, 289 (73.5 percent) reported month-over-month price appreciation, and 303 (77.1 percent) showed annual appreciation. All 30 of the largest metro areas registered both monthly and yearly appreciation, and all “have hit their bottom and are expected to show appreciation in the next 12 months,” Zillow said.
Metros with the largest annual increases in July included Sacramento (33.1 percent), Las Vegas (30.8 percent), and San Francisco (27.8 percent).
For the 12-month period ending July 2014, national home values are forecast to rise another 4.8 percent to approximately $169,308, according to the Zillow Home Value Forecast. Of the largest metro areas, Sacramento, Riverside, and San Francisco are expected to show the most appreciation over the next year.
By Tory Barringer