Real estate research firm Zillow reports that the cumulative value of the US housing market will increase year over year in 2012. The value of all homes together increased by $1.3 trillion over 2011 and marks the first gain in five years. It’s also the highest gain since 2005 and has been fueled by historically low interest rates, low prices and increased investor demand. Those prices have gone up, however, in 75% of the 177 metro areas surveyed by Zillow and experts expect the trend to gain momentum as more homeowners get clear of negative equity and consumer confidence rises. For more on this continue reading the following article from Property Wire.
US homes are expected to gain more than $1.3 trillion in cumulative value in 2012, the first annual gain in more than five years and the largest since 2005, according to a new report.
The latest analysis from real estate market reports firm Zillow has calculated the difference between cumulative home values as of the end of 2011 and anticipated cumulative home values at the end of 2012.
It says that overall, US homes will have gained approximately $1.35 trillion in cumulative value during 2012, to a total of approximately $23.7 trillion, up 6%. Last year, cumulative home values fell almost $792 billion from 2010.
The gain in cumulative home values is the first annual increase since homes gained $483 billion in total value in 2006. Cumulative home values fell each year from 2007 through 2011, with the largest drop coming in 2008, when homes lost more than $3.2 trillion in value, according to Zillow.
More than 75% of the 177 metro areas included in this analysis, 135 in all, experienced cumulative home value gains in 2012. Among the 30 largest metro areas covered by the report, only Philadelphia failed to record an annual gain in cumulative home values.
Of the 30 largest metros, those with the largest gains in cumulative value as measured by total dollar volume include Los Angeles at $122.1 billion, San Francisco at $93.3 billion, San Jose in California at 54.7 billion, Phoenix at $52 billion and Miami-Fort Lauderdale at $47.5 billion.
'This gain in cumulative home values is welcome and long-awaited, after years of cumulative value declines. After a sluggish 2011, the housing market really turned a corner in 2012, as historic affordability and sustained investor interest helped keep demand at a boil,' said Zillow chief economist Stan Humphries.
'We expect value gains to continue into 2013. As home values rise, and more homeowners are freed from negative equity, we can expect a continued slow transition to a more normal housing environment driven by local market fundamentals and conditions,' he added.
This article was republished with permission from Property Wire.