Photo: Robert Clark
Over the last year, the total value of all homes in the US grew at its fastest annual pace in nearly four years.
Three of the country’s hottest housing markets are now valued over $1 trillion, while the New York City and Los Angeles metro areas each accounted for more than 8 percent of the total value of the country’s entire housing stock, according to a report released today by the listing site Zillow.
The total value of the country’s housing stock rose by $2 trillion from last year to $31.8 trillion. The cumulative value of the US housing market grew by 6.5 percent annually since 2013, the early stages of the housing market recovery — the fastest pace since 2013, when the value of all US homes rose 8 percent annually.
To put that in perspective, the value the US housing market gained this year alone is equivalent to more than twice the valuation of Apple. Since last year, the housing market has grown by nearly $2 trillion, while Apple recently hit a market value of $900 billion — the first US company to achieve this feat.
“For many households, a home is the single largest source of wealth, but the collapse of the housing market and the ensuing Great Recession demonstrated the importance of housing to the US economy as well,” says Zillow in the report.
Since the lowest levels recorded during the Great Recession, the housing market has gained $9 trillion since the lowest levels of the recession.
The Los Angeles, New York City and San Francisco markets are the only markets valued at more than $1 trillion. The Los Angeles and New York markets are worth $2.7 trillion and $2.6 trillion, respectively.
The San Francisco market is valued at $1.4 trillion.
Among the 35 largest housing markets, Columbus, OH, grew the most in 2017 — gaining 15.1 percent from last year.
The value of the San Jose,CA Dallas, TX, Seattle, WA Tampa, FL, Las Vegas, NV, and Charlotte, NC, housing markets all grew by at least 10 percent from last year.
"Strong demand from buyers and the ongoing inventory shortage keep pushing values higher, especially in some of the nation's booming coastal markets,” says Zillow Senior Economist Aaron Terrazas in the report.
Meantime, American renters paid more than ever in rent in 2017, but rents grew at their slowest pace in recent years. The total value of rent paid in the US this year grew by one percent annually to $485.6 billion, up nearly $5 billion from 2016.
New York City and Los Angeles renters spent the most on rent in 2017. New Yorkers shelled out $54 billion on rent, while Los Angelenos paid $38.6 billion this year. These two markets are also home to the largest populations of renter households.
“More renters transitioned into homeownership this year and new rental supply slowed rent growth across the country,” Terrazas says in the report.
In the upcoming year, despite the recent changes to federal tax laws, Terrazas believes the “long-term dynamics pushing up home values and rents are unlikely to change significantly."
And in NYC, "the nation’s premier rental market," a handful of industries could see faster growth in the coming year – notably finance and a growing tech scene — which means the total rent paid should continue growing in New York in 2018, Terrazas tells BuzzBuzzNews.
Click here to read the entire report.