The April 2017 Zillow Real Estate Market Report states that the median value of homes in the United States has grown to its highest rate in more than a decade. Since last April, U.S. home values have risen an average of 7.3 percent, putting the average national value at $198,000.
Now, a decade after the housing market crash, home values are finally returning to their pre-crash peaks. These rates have many Americans wondering if we are at the verge of another national housing bubble, but Zillow’s Chief Economist, Dr. Svenja Gudell, says that there is nothing to worry about.
“We aren’t in a bubble, and won’t be entering one anytime soon,” Gudell reported. “There are big differences between the market then and the market now: Then, loose credit, speculation and overbuilding were ingredients in a recipe for disaster. Now, healthy homebuyer demand is being driven largely by a stable economy and demographic tailwinds, which is exactly what we would expect in a healthy market. Supply has been slow to catch up to this demand, which is causing home values to grow at a faster clip than we might otherwise expect.”
While Dr. Gudell is correct when she states that the supply of houses on the market has not been able to keep up with the demands of home buyers, the National Association of Home Builders recently stated that home builder confidence in the market for new single family homes is also on the uprise. NAHB Chairman Granger MacDonald states,“[the new Housing Market Index] report shows that builders’ optimism in the housing market is solidifying.”
This is great news for potential homebuyers, as it indicates both a strong market and future growth in available housing. With the market constantly growing and expanding, it’s a great time to discuss your housing options with a local lender. For more information about home value rates, or to learn more about home financing options, contact one of our mortgage specialists today.