Dive Brief:
- 27.9% of homes across the U.S. lost value over the past year, according to Zillow’s August Real Estate Market Report.
- The Eastern U.S. saw the biggest drops in home values, while values in the West held fairly steady. "Slow" markets like Baltimore (48.1%), Philadelphia (43.4%) and Washington, DC (41.2%) had the largest percentage of homes lose value, while "hot" markets like Denver (1.5%), Dallas (4%), San Francisco (5.2%) and San Jose (6.5%) had the smallest.
- Home values rose nationally 3.3% from a year ago, reaching a Zillow Home Value Index of $180,800, which suggests that the U.S. housing growth rate has leveled off, according to Zillow.
Dive Insight:
Zillow Chief Economist Svenja Gudell said of the home value decreases, "We're not going in reverse, but we are hitting the brakes a bit in some markets... The reality is there are still areas lagging behind in the recovery."
However, on the upside, renters, according to Zillow, may be finding more homebuying opportunities in the slower markets. Between January and August, the percentage of Philadelphia renters planning to buy a home within a year jumped 10%.
Coupled with the fact that rents, according to the Zillow Rent Index, are growing faster than home values, the slowing of home prices could encourage renters in the slower markets to enter the housing market. Builders in those slower markets could soon see an influx of potential new buyers.
