SEATTLE, Dec. 22, 2021 /PRNewswire/ -- (NASDAQ: RDFN) —
U.S. homeowners gained $9.1 trillion
of housing value over the past year as housing prices continued to
climb amid a severe shortage of homes for sale, according to a new
report from Redfin (redfin.com), the technology-powered real estate
brokerage. The value of U.S. homes surged 31.4% year over year to a
total of $38.3 trillion last month,
far outpacing the 9.7% ($2.6
trillion) annual increase seen the prior November.
Home prices have skyrocketed during the pandemic as record-low
mortgage rates, remote work and a soaring stock market have fueled
a swell in homebuyer demand amid an ongoing housing shortage.
November marked the 16th-straight month of double-digit price
gains, while the number of homes for sale sunk to a record low.
"The surge in housing values during the pandemic has widened the
gap between homeowners and renters in America. Homeowners have seen
their wealth increase significantly over the past year, while
renters have missed out on those gains and are now grappling with
rent inflation," said Redfin Chief Economist Daryl Fairweather. "The silver lining is that
housing values didn't just climb in large affluent cities.
Homeowners in rural America, who don't normally see substantial
home-value increases, also reaped the benefits of a booming housing
market."
Rural Home Value Soars 46%, Outpacing Cities and
Suburbs
The value of rural homes rose 46.2% year over year to a total of
$4.9 trillion in November. By
comparison, the value of urban homes increased 31.3% to
$8 trillion and the value of suburban
homes climbed 25.9% to $24.1
trillion.
While cities have been bouncing back from a coronavirus
slowdown, rural areas remain more popular than they were before the
pandemic as remote workers continue to seek extra space and
relative affordability.
Condos See 43% Jump in Value, Rebounding After Pandemic
Slump
The value of condos climbed 42.7% year over year to $5.1 trillion in November. By comparison, the
value of single-family homes rose 30.1% to $32 trillion and the value of townhouses
increased 20.6% to $1.2 trillion.
The pandemic hit the condo market hard in 2020, with scores of
Americans exchanging cramped urban life and shared amenities for
bigger homes in the suburbs and rural areas. But as lockdown
restrictions eased and the initial shock of the pandemic faded,
condos and city life began to make a comeback. This explains why
condo values saw a relatively large year-over-year gain.
Housing Value Surges Most in Migration Hot Spots Including
Austin and Phoenix
The value of homes in Austin,
TX surged 48.1% year over year to $389.5 billion in November—the largest gain among
the 50 most populous U.S. metropolitan areas. It was followed by
Jacksonville, FL (39.9%) and
Phoenix, AZ (38.3%). Tampa, FL and Riverside, CA rounded out the top five, with
increases of 36% and 32%, respectively.
Homebuyers have flocked to Sun Belt states during the pandemic
as remote work has allowed them to prioritize affordability over
proximity to the office. Austin,
Phoenix and Tampa have consistently been among the hottest
spots for homebuyers looking to relocate during the pandemic.
Out-of-towners moving to Austin
tend to pay more for homes than locals, which has boosted housing
prices in the metro overall as people from more expensive cities
like San Francisco and
New York have moved in. A July
Redfin report found that the typical home purchased by
out-of-towners in Austin sells for
$470,000, versus $447,500 for locals.
With home prices surging across the Sun Belt, Fairweather
predicts homebuyers will increasingly start moving to more
affordable northern cities like Indianapolis, IN, Columbus, OH and Harrisburg, PA.
Millennials Reap 34% Gain in Home Value—More Than Other
Generations
The value of homes owned by millennials grew 34.3% year over
year ($1.2 trillion) to a total of
$4.6 trillion in the third
quarter—the most recent period for which data was available.
Millennials have taken up an increasing share of the U.S. housing
market as they've grown into homeowning age, accounting for more
than half of new mortgages last year. Many of them bought their
first home in 2020—when housing values began to skyrocket—which
meant they saw significant wealth gains during their first year of
homeownership.
American Indian and Alaskan Native Neighborhoods See 72% Jump
in Home Value
The value of homes in neighborhoods that are majority American
Indian and Alaskan Native rose 72.3% year over year in November,
more than any other race Redfin analyzed. By comparison, majority
white neighborhoods saw a 30.4% increase and majority Black
neighborhoods experienced a 26% gain. Meanwhile, Hispanic or Latino
neighborhoods saw 24.4% growth and Asian neighborhoods experienced
a 22% gain.
"Many of the American Indian and Alaskan Native areas that saw
large home-value increases are rural and/or in Arizona, a reflection of pandemic-driven
migration to more affordable, spacious towns," Fairweather said.
"This is a boon for minority homeowners in these places, but poses
a threat to renters who could get priced out due to
gentrification."
High-Fire Risk Homes Are Worth 42% More Than a Year
Ago
The value of homes in areas with high fire risk rose 42.1% year
over year to a total of $1.8 trillion
in November. By comparison, the value of homes in areas with high
flood, storm, heat and drought risk climbed about 30%.
Many high-fire risk areas are also hot spots for second homes,
which have been in high demand during the pandemic as affluent
Americans have sought respite from city life.
To read the full report, including charts and additional
metro-level highlights, please visit:
https://www.redfin.com/news/real-estate-home-value-surge-november-2021
About Redfin
Redfin (www.redfin.com) is a
technology-powered real estate company. We help people find a place
to live with brokerage, instant home-buying (iBuying), rentals,
lending, title insurance, and renovations services. We sell homes
for more money and charge half the fee. We also run the country's
#1 real-estate brokerage site. Our home-buying customers see homes
first with on-demand tours, and our lending and title services help
them close quickly. Customers selling a home can take an instant
cash offer from Redfin or have our renovations crew fix up their
home to sell for top dollar. Our rentals business empowers millions
nationwide to find apartments and houses for rent. Since launching
in 2006, we've saved customers more than $1
billion in commissions. We serve more than 100 markets
across the U.S. and Canada and
employ over 6,000 people.
For more information or to contact a local Redfin real estate
agent, visit www.redfin.com. To learn about housing market trends
and download data, visit the Redfin Data Center. To be added to
Redfin's press release distribution list, email press@redfin.com.
To view Redfin's press center, click here.
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SOURCE Redfin