Zillow: Home Prices Stagnate After 9 Months of Appreciation
Zillow is reporting a slowdown in recent house price appreciation after 9 months of gains. The decline was marginal, but consistent with a slow seasonal period and still difficult real estate conditions. We’re entering a much weaker seasonal period for housing so much of the recent exuberance over the “housing recovery” is likely to grow quiet. Zillow has more details:
Zillow’s August Real Estate Market Reports, released today, show that home values decreased 0.1 percent to $152,100 from July to August (Figure 1). This is the first monthly decline after nine consecutive months of appreciation. This year has seen a turnaround in the housing market with sustained appreciation that, at times, has been very strong.
As we enter the back half of this year, we expect home values to see more volatility with a saw tooth pattern setting in characterized by months of home value declines interspersed with months of appreciation. Overall, the positive trend will hold as evidenced by home values being up by 1.7 percent (Figure 2) in August 2012 on a year-over-year basis.
Rents continued to rise in August, appreciating by 0.2 percent from July to August. On an annual basis, rents across the nation are up by 5.9 percent (Figure 3), indicating that demand, fueled by elevated foreclosure levels, is still outpacing investor-driven increases in rental supply.
Cullen Roche
Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.
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3 Comments
According to my info, home prices peaked in (very) early 2006 and not in 2007.
Is it possible for you to post that data?
I’m heard mixed reviews from Realtors about Zillows valuations. My understanding is they have some kind of formula/algo that includes data on square footage, assessments, comps, etc. but cannot account for improvements made by owners between sales (like redoing a kitching or bathroom or adding a deck or a pool) so their valuation can be off by as much as 20%. Their data is probably still good as a direction indicator based on the data they us as inputs.