A new analysis by Zillow found that homeowners on the West Coast don’t have to wait very long to see a huge return on investment.
After about nine years, Seattle sellers gained 53.1 percent or $185,000 on a 2016 sale. Gains were highest in Oakland, where a typical seller in 2016 sold their home for an average of $590,000 after living in it for just over seven years. That’s an increase of 78 percent more than their initial payment. The typical 2016 seller in Portland sold for about $145,000 more than what they paid nine years earlier, a 65 percent gain.
The top cities for return on investment after Oakland and Portland are San Jose, Denver, Los Angeles, Sacramento, Seattle, Philadelphia, New Orleans and Boston.
The housing market recovery has sent home values soaring higher in the past several years, especially in West Coast cities that are attracting people with well-paying jobs, reports Zillow. Despite the opportunity to cash in on record-high home values, some homeowners choose not to sell because they don’t want to become buyers in a competitive market.
“The housing market can change a lot in 10 years, and you see that reflected in this top 10 list,” said Zillow Chief Economist Dr. Svenja Gudell in a press release. “Buying a home is one of the biggest financial decisions people will make in their lifetime, and it really paid off for sellers in these cities. Every city on this list has been growing extremely fast over the past decade, with the majority passing peak home value hit during the housing bubble. It’s extremely difficult to time the market, but if you’re a longtime homeowner in one of these cities, you could potentially see a great return on your investment.”
Of the cities tracked, Baltimore sellers saw the lowest return on their initial investment making just $5,000 in profits — or 5.4 percent of what they initially put in. Memphis, Tennessee, was next, with $6,800 in profits and an 8.5 percent ROI.