Home values nationwide rose nearly 7% in 2016 and show no signs of slowing in 2017, according to a new report by Zillow.
According to the December Zillow Real Estate Market Reports. the median home value in the U.S. in December was $193,800, just below the highest value set in April 2007.
“Home values ended 2016 growing at their fastest pace of the year, which could be an indication of what to expect in 2017,” Zillow Chief Economist Dr. Svenja Gudell said in a news release. “Lack of inventory will remain a major concern for home buyers this year. Especially lack of available entry-level homes coupled with high demand will continue to rapidly drive up home values in the near future.”
Home value appreciation in Portland remains the fastest in the nation, up 13.8% from December 2015. Tampa, Seattle and Dallas saw similarly high home value growth, with home values increasing by nearly 12% from a year ago, according to the Zillow release.
“Buyers should make sure they get pre-approved for a mortgage, and be prepared to move quickly, especially in hot markets like Seattle and Portland,” Gudell said in the release. “It’s not uncommon for buyers to make at least two offers during their home search.”
Flattening rents could take the heat off buyers who are struggling to find a home amid low inventory and give them more time to search for the right home, the release stated. Rent appreciation stabilized at 1.5% annual growth, less than half the pace rents were growing at last year. The median monthly rent payment in the U.S. is $1,403, according to the release.
Finding an affordable home is the top concern for people searching for homes, according to the release, as there are 4.6% fewer available homes than there were a year ago.