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National Home Values Rose 5.9 Percent in 2012, But High Growth Rate Likely Unsustainable

Q4 Marks Fourth Consecutive Quarter Of Home Value Increases; Values Expected To Rise Another 3.3 Percent In 2013

SEATTLE, Jan. 22, 2013 /PRNewswire/ -- U.S. home values ended 2012 up 5.9 percent over the end of 2011, marking four consecutive quarters of national home value appreciation. The Zillow® Home Value Index[i] (ZHVI) rose to $157,400 in the fourth quarter, up 2.5 percent over the third quarter, according to the fourth quarter Zillow Real Estate Market Reports[ii].

The 5.9 percent annual appreciation rate far exceeded yearly rates of appreciation typically associated with healthy markets and represents the largest annual gain since August, 2006 – near the peak of the housing bubble. Historically, housing markets can expect annual home value appreciation of roughly 3 percent on average, according to Zillow research. Looking ahead, the Zillow Home Value Forecast shows home values increasing by 3.3 percent in 2013, a yearly appreciation rate more in line with historic norms.

Home value appreciation was widespread last year. Of the 30 largest metros covered by this report, only Cincinnati and Chicago failed to show annual and quarterly increases in the fourth quarter. Of the 366 total metro areas analyzed, 254 – or 69 percent – registered annual home value gains in 2012; 278 metros experienced quarter-over-quarter home value appreciation.

Annual home value growth rates varied widely among the nation's 30 largest metros, underlining the uneven recovery the housing market is experiencing. Growth rates ranged from a high of 22.5 percent year-over-year appreciation in Phoenix to a low of 0.2 percent depreciation in Cincinnati and Chicago. Seven of the top 30 metros registered annual home value increases of 10 percent or more.

"We expected 2012 to be a good year for housing, and it delivered in spades. Strong demand paired with limited inventory in many markets helped fuel a robust and often rapid recovery in overall home values, good news for homeowners after years of poor performance. We expect this recovery to continue into 2013, but at a more sustainable pace," said Zillow Chief Economist Dr. Stan Humphries. "It's important to be cautious moving forward, even as we celebrate the undeniably positive end to 2012, and be careful that consumers don't grow to expect such high appreciation as the norm. Buying a home should be a long-term decision, and these swings between a deep housing recession and higher-than-normal appreciation rates can give consumers whiplash and cause some to lose sight of that."

As home values rose in the fourth quarter, foreclosure activity abated, with 5.22 of every 10,000 homes nationwide facing foreclosure during December 2012. That was down 2.2 homes per 10,000 year-over-year and down 1.2 homes from the previous quarter. Foreclosure re-sales stood at 12 percent of the market, down 4 percent from the end of 2011 and down 0.3 percent from the third quarter.

In the rental market, national rents fell 0.6 percent in the fourth quarter compared with the third quarter, but ended 2012 up 4.2 percent year-over-year. The Zillow Rent Index[iii] (ZRI) stood at $1,274 at the end of December.


Zillow Home Value Index

Zillow Rent Index

METROS

Q4 2012 ZHVI

Quarter-Over-Quarter Change

Year-Over-Year Change

Q4 2012 ZRI

Quarter-Over-Quarter Change

Year-Over-Year Change

UNITED STATES

$157,400

2.5%

5.9%

$1,274

-0.6%

4.2%

New York

$345,700

1.2%

0.9%

N/A

N/A

N/A

Los Angeles

$414,900

4.0%

7.9%

$2,296

0.3%

2.9%

Chicago

$161,600

-0.4%

-0.2%

$1,517

-1.4%

5.3%

Dallas-Fort Worth

$130,500

1.6%

4.8%

$1,321

-0.7%

4.3%

Philadelphia

$187,000

0.8%

0.5%

$1,479

-1.0%

1.6%

Washington, D.C.

$324,000

2.1%

5.2%

$2,054

-1.0%

3.3%

Miami-Ft. Lauderdale

$153,200

2.5%

9.7%

$1,612

1.0%

2.3%

Atlanta

$114,300

2.5%

0.1%

$1,125

-1.1%

0.5%

Boston

$320,700

2.7%

5.3%

$1,955

-1.6%

6.6%

San Francisco

$526,200

4.8%

14.0%

$2,517

0.8%

5.1%

Detroit

$81,200

3.2%

9.7%

$1,049

0.1%

5.0%

Riverside

$197,400

4.5%

9.3%

$1,575

1.1%

2.5%

Phoenix

$157,800

4.6%

22.5%

$1,152

-0.4%

2.4%

Seattle

$270,500

2.3%

6.5%

$1,615

-1.4%

2.6%

Minneapolis-St. Paul

$175,300

2.2%

7.5%

$1,439

-1.1%

3.8%

San Diego

$373,400

4.6%

10.0%

$2,104

-1.3%

1.4%

Tampa, Fla.

$112,800

1.6%

5.6%

$1,187

0.3%

2.8%

St. Louis

$126,200

0.3%

1.2%

$1,101

-1.2%

1.9%

Baltimore

$222,000

1.1%

2.4%

$1,669

-0.8%

5.0%

Denver

$228,600

3.1%

12.1%

$1,515

0.3%

6.5%

Pittsburgh

$112,000

1.7%

3.0%

$985

-4.7%

1.2%

Portland, Ore.

$230,300

2.5%

7.7%

$1,383

-2.1%

4.6%

Sacramento, Calif.

$225,200

6.1%

11.7%

$1,456

-1.2%

3.2%

Orlando, Fla.

$125,600

2.4%

6.5%

$1,204

-0.5%

1.7%

Cincinnati

$121,900

-1.4%

-0.2%

$1,069

-0.1%

-2.5%

Cleveland

$111,000

0.9%

2.2%

$1,082

-0.4%

0.1%

Las Vegas

$129,100

5.5%

13.9%

$1,145

-1.0%

-1.0%

San Jose, Calif.

$630,800

4.9%

15.4%

$2,646

1.3%

5.0%

Columbus, Ohio

$126,200

0.3%

2.6%

$1,134

-1.0%

0.3%

Charlotte, NC

$137,600

1.6%

2.7%

$1,139

-1.6%

6.1%

A more detailed analysis of Q4 data can be found on the Zillow Research blog. To obtain information at the ZIP code, county, city, metro and/or state levels, or to speak with someone at Zillow, please email press@zillow.com.

About Zillow:
Zillow (NASDAQ: Z) is the leading real estate information marketplace, providing vital information about homes, real estate listings and mortgages through its website and mobile applications, enabling homeowners, buyers, sellers and renters to connect with real estate and mortgage professionals best suited to meet their needs. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow's Chief Economist Dr. Stan Humphries. Dr. Humphries and his team of economists and data analysts produce extensive housing data and research covering more than 350 markets at Zillow Real Estate Research. Zillow, Inc. operates Zillow.com®, Zillow Mortgage Marketplace,  Zillow Rentals, Zillow Mobile, Postlets®, Diverse Solutions®, Buyfolio™, Mortech™ and HotPads™. The company is headquartered in Seattle.

Zillow.com, Zillow, Postlets and Diverse Solutions are registered trademarks of Zillow, Inc. Buyfolio, Mortech and HotPads are trademarks of Zillow, Inc.

[i] The Zillow Home Value Index is the median Zestimate® valuation for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. It is expressed in dollars, and seasonally adjusted.
[ii] The Zillow Real Estate Market Reports are a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Real Estate Research. For more information visit www.zillow.com/research. The data in Zillow's Real Estate Market Reports is aggregated from public sources by a number of data providers for 923 metropolitan and micropolitan areas dating back to 1996. Mortgage and home loan data is typically recorded in each county and publicly available through a county recorder's office.
[iii] The Zillow Rent Index is the median Rent Zestimate (estimated monthly rental price) for a given geographic area on a given day, and includes the value of all single-family residences, condominiums, cooperatives and apartments in Zillow's database, regardless of whether they are currently listed for rent. It is expressed in dollars.

SOURCE Zillow, Inc.


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