National Home Values Nearly 9% Below Bubble Peak
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“This transition from housing recovery to a more normal market is a good thing in the long-term, but we can expect some bumps along the way,” says Humphries.
SEATTLE—Bidding wars are helping drive up home values in the nation’s hottest housing markets, even as home values level off far below the record levels set during the real estate bubble in quieter markets. That is according to the May Zillow Real Estate Market Report.
May’s report shows local markets diverging, with some chugging along, some stalled out and some continuing to accelerate amid rising prices and competition. “What we’re seeing is the passing of the baton—as mortgage rates begin to rise and incomes and household formation rates increase—from a stimulus-driven housing market to one driven by fundamentals,” said Zillow Chief Economist Dr. Stan Humphries. “This transition from housing recovery to a more normal market is a good thing in the long-term, but we can expect some bumps along the way. In the end, increasing household formation and stronger income growth should be able to overcome the headwind of rising mortgage rates and return markets to health.”…
