SEATTLE, Feb. 19, 2021 /PRNewswire/ -- Extreme demand
driven by exceptionally low mortgage rates, demographic pressures
and pandemic trends kept the housing market boiling as we moved
into 2021, according to Zillow's® latest market report.
Monthly appreciation of home values in January matched recent
record highs, while annual growth is higher than any time since
2006. Home sales are moving briskly, with homes typically staying
on the market for 18 days as of mid-January before the seller has
accepted an offer from a buyer -- 28 days faster than in 2020 and
2019. For-sale inventory declined again in January, and now stands
26.3% below levels from a year ago.
The Zillow Home Value Index (ZHVI) rose to $269,039 in January, up 1.1% month over month,
matching December's all-time record for monthly growth in data
reaching back to 1996. Annual home value appreciation was 9.1% --
the largest annual growth recorded since June 2006, before the Great Recession.
"Homebuying demand has pushed the pedal to the metal for price
appreciation this winter," said Jeff
Tucker, senior economist at Zillow. "Normally we'd be
talking about the spring selling season ramping up, but it looks
more like last summer's selling season simply never ended. Buyers
eager to secure more space and lock in today's rock-bottom interest
rates are having to move quickly and aggressively to win out in
this competitive market."
Home values rose in all 50 of the largest U.S. metros, with the
most drastic yearly growth in Phoenix (17.1%), San
Jose (14.2%) and Austin
(13.7%). The slowest growth -- a relative term in this case -- was
seen in San Francisco (5.3%),
Chicago (6.7%), and San Antonio (6.7%).
A few major demand drivers are keeping competition high and the
market hot through the customarily cool winter. For one, a wave of
millennials are now entering their peak home-buying years. The
number of Americans aged 25-34 was 12% higher in July 2020 than July
2010, according to Census estimates -- an increase of
approximately 4.9 million people.
Another is mortgage rates, which averaged 2.74% for a standard
30-year fixed in January -- up slightly from a historic low of
2.68% in December. These rates are making monthly mortgage payments
more affordable as a percentage of income, even when considering
rising prices.
The COVID-19 pandemic and widespread changes to work-from-home
policies have also pushed many to reconsider what they want and
need in their living space, and where it should be.
Looking forward, Zillow economists expect home values to grow
10.1% in the next 12 months. The Zillow forecast for existing home
sales has been revised up since December, driven by improved
pending sales volumes and home purchase applications. Existing home
sales are expected to reach 7 million in 2021, 24.8% more than in
2020.
While home prices are rising quickly, rents are relatively
stagnant. The Zillow Observed Rent Index (ZORI) was $1,721 in January, just 0.5%, or $9, higher than in January
2020 and up 0.3% month over month.
Rents in many expensive, coastal metros are currently much lower
than a year ago -- down 9.2% in San
Francisco, 8.8% in New
York, 7.2% in San Jose, and
6.3% in Boston. Many Sun Belt and
Midwest metro areas, on the other hand, saw solid rent growth.
Phoenix led the largest 35 metro
areas with 8.4% annual rent growth, followed by Sacramento (7.6%) and Indianapolis (6.9%).
Metropolitan
Area*
|
Zillow Home Value
Index, January 2021
|
ZHVI - YoY Change,
January 2021
|
Zillow Observed
Rent Index, January 2021
|
ZORI - YoY Change,
January 2021
|
United
States
|
$269,039
|
9.1%
|
$1,721
|
0.5%
|
New York,
NY
|
$516,732
|
7.7%
|
$2,465
|
-8.8%
|
Los Angeles-Long
Beach-Anaheim, CA
|
$748,532
|
9.6%
|
$2,542
|
-0.8%
|
Chicago,
IL
|
$259,459
|
6.7%
|
$1,614
|
-2.9%
|
Dallas-Fort Worth,
TX
|
$273,348
|
7.9%
|
$1,555
|
2.0%
|
Philadelphia,
PA
|
$277,775
|
10.6%
|
$1,578
|
2.3%
|
Houston,
TX
|
$231,195
|
7.0%
|
$1,464
|
0.4%
|
Washington,
DC
|
$475,850
|
8.6%
|
$2,006
|
-3.4%
|
Miami-Fort
Lauderdale, FL
|
$323,431
|
7.7%
|
$1,913
|
2.1%
|
Atlanta,
GA
|
$264,565
|
9.7%
|
$1,602
|
5.7%
|
Boston, MA
|
$539,592
|
9.4%
|
$2,277
|
-6.3%
|
San Francisco,
CA
|
$1,178,615
|
5.3%
|
$2,876
|
-9.2%
|
Detroit,
MI
|
$198,979
|
10.3%
|
$1,293
|
6.1%
|
Riverside,
CA
|
$433,226
|
11.7%
|
|
|
Phoenix,
AZ
|
$335,975
|
17.1%
|
$1,572
|
8.4%
|
Seattle,
WA
|
$594,223
|
12.8%
|
$1,866
|
-5.5%
|
Minneapolis-St Paul,
MN
|
$320,438
|
8.6%
|
$1,543
|
0.8%
|
San Diego,
CA
|
$689,361
|
13.5%
|
$2,383
|
4.3%
|
St. Louis,
MO
|
$197,073
|
9.0%
|
$1,093
|
3.8%
|
Tampa, FL
|
$257,499
|
12.8%
|
$1,589
|
6.6%
|
Baltimore,
MD
|
$319,175
|
8.2%
|
$1,646
|
2.2%
|
Denver, CO
|
$488,746
|
9.0%
|
$1,709
|
0.1%
|
Pittsburgh,
PA
|
$178,282
|
10.4%
|
$1,177
|
1.2%
|
Portland,
OR
|
$458,486
|
9.7%
|
$1,649
|
1.2%
|
Charlotte,
NC
|
$265,397
|
10.9%
|
$1,514
|
3.1%
|
Sacramento,
CA
|
$478,817
|
11.3%
|
$1,916
|
7.6%
|
San Antonio,
TX
|
$222,816
|
6.7%
|
$1,330
|
2.5%
|
Orlando,
FL
|
$276,168
|
7.5%
|
$1,594
|
2.2%
|
Cincinnati,
OH
|
$208,352
|
12.0%
|
$1,259
|
5.5%
|
Cleveland,
OH
|
$176,069
|
11.1%
|
$1,121
|
3.7%
|
Kansas City,
MO
|
$227,059
|
10.6%
|
$1,193
|
5.0%
|
Las Vegas,
NV
|
$315,966
|
8.0%
|
$1,493
|
6.7%
|
Columbus,
OH
|
$234,276
|
10.8%
|
$1,278
|
5.2%
|
Indianapolis,
IN
|
$204,141
|
11.3%
|
$1,262
|
6.9%
|
San Jose,
CA
|
$1,314,799
|
14.2%
|
$2,892
|
-7.2%
|
Austin, TX
|
$384,446
|
13.7%
|
$1,511
|
-1.2%
|
Virginia Beach,
VA
|
$264,060
|
8.3%
|
$1,376
|
6.1%
|
Nashville,
TN
|
$304,571
|
8.9%
|
$1,595
|
1.9%
|
Providence,
RI
|
$357,761
|
12.0%
|
$1,603
|
8.2%
|
Milwaukee,
WI
|
$219,381
|
12.1%
|
$1,169
|
2.7%
|
Jacksonville,
FL
|
$252,678
|
9.4%
|
$1,370
|
5.6%
|
Memphis,
TN
|
$174,063
|
11.3%
|
$1,337
|
10.0%
|
Oklahoma City,
OK
|
$170,138
|
7.5%
|
$1,098
|
3.9%
|
Louisville-Jefferson
County, KY
|
$197,548
|
8.7%
|
$1,044
|
4.7%
|
Hartford,
CT
|
$260,546
|
9.5%
|
$1,353
|
5.0%
|
Richmond,
VA
|
$268,405
|
8.4%
|
$1,294
|
4.8%
|
New Orleans,
LA
|
$224,193
|
7.9%
|
$1,290
|
3.8%
|
Buffalo,
NY
|
$193,583
|
11.4%
|
$1,124
|
5.3%
|
Raleigh,
NC
|
$307,481
|
8.8%
|
$1,503
|
2.6%
|
Birmingham,
AL
|
$188,327
|
9.8%
|
$1,129
|
5.5%
|
Salt Lake City,
UT
|
$436,390
|
13.7%
|
$1,408
|
3.3%
|
*Table ordered by market size
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate
to make it easier to unlock life's next chapter.
As the most-visited real estate website in the U.S., Zillow® and
its affiliates offer customers an on-demand experience for selling,
buying, renting or financing with transparency and nearly seamless
end-to-end service. Zillow Offers® buys and sells homes directly in
dozens of markets across the country, allowing sellers control over
their timeline. Zillow Home Loans™, our affiliate lender, provides
our customers with an easy option to get pre-approved and secure
financing for their next home purchase. Zillow recently launched
Zillow Homes, Inc., a licensed brokerage entity, to streamline
Zillow Offers transactions.
Zillow Group's affiliates and subsidiaries include Zillow®,
Zillow Offers®, Zillow Premier Agent®, Zillow Home Loans™, Zillow
Closing Services™, Zillow Homes, Inc., Trulia®, Out East®,
StreetEasy® and HotPads®. Zillow Home Loans, LLC is an Equal
Housing Lender, NMLS #10287
(www.nmlsconsumeraccess.org).
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SOURCE Zillow