The median U.S. home value has seen 52 consecutive months of annual growth, but the rate has sped up considerably since September.
The November Housing Market Overview from Zillow notes that home values rose 6.5 percent year-over-year in November, the fastest growth since August 2006. The Zillow Home Value Index is now $192,500.
Additionally, rents rose 1.5 percent over the past year, pushing the Zillow Rent Index to $1,403 per month, and the number of homes for sale decreased 5.9 percent on an annual basis in November. Annual inventory levels have falled for 22 straight months. According to Zillow chief economist Svenja Gudell, these interconnected trends will likely continue into 2017.
The accelerating home values are influenced by an improving national economy, thriving local economies, and a powerful seller's market fueled by the lack of available homes.
In general, home value growth continues to be strong, supported by solid buyer demand and still-limited for-sale inventory in many markets across the country. And while some of the raw numbers may look the same, conditions today are very different than the ones we saw back in 2006 – the last time we saw such a fast rate of appreciation. Gone are the days of rampant real estate speculation and loose mortgage credit, replaced by sound economic fundamentals.
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