Hot housing markets like Seattle and San Francisco have seen home values shooting toward the stratosphere. And now they may be ready to come down a bit closer to Earth.
The rate of home-value appreciation is slowing in two-thirds of the country’s largest housing markets, according to a new report from real-estate website Zillow Z, -1.18%
Nowhere was that more true than in Seattle. Last year, the Emerald City led the country in terms of home-value growth, with values appreciating at an annual rate of 14%. Seattle now only ranks 12th in the country for home-value growth with a rate of 9%.
Other housing markets that notched the most notable slowdowns in home-value appreciation include Tampa, Fla., Sacramento, Calif., and Portland.
Also see: Buyers in expensive neighborhoods find more homes for sale
Metropolitan area Current annual home value growth July 2017 annual home value growth Average rate of home value growth United States 8% 7.3% 3.7% New York, N.Y. 5.9% 6.8% 4.8% Los Angeles-Long Beach-Anaheim, Calif. 6.2% 7.3% 6.9% Chicago, Ill. 5.2% 5.8% 2.4% Dallas-Fort Worth, Texas 11.6% 11.9% 3.1% Philadelphia, Penn. 5.5% 5.9% 3.6% Houston, Texas 6% 4.9% 3% Washington, D.C. 3.4% 3.4% 4.8% Miami-Fort Lauderdale, Fla. 8.4% 10.3% 5.9% Atlanta, Ga. 12.2% 8.1% 3.2% Boston, Mass. 6.9% 8.2% 5.3% San Francisco, Calif. 10.4% 6.9% 7.2% Detroit, Mich. 9.9% 10% 2.6% Riverside, Calif. 7% 8% 6.2% Phoenix, Ariz. 7.7% 7.3% 4.8% Seattle, Wash. 9.1% 14.2% 5.6% Minneapolis-St. Paul, Minn. 6.9% 7.7% 4.3% San Diego, Calif. 6% 8.3% 6.6% St. Louis, Mo. 5.4% 5.3% 3% Tampa, Fla. 10.6% 14.2% 5.3% Baltimore, Md. 4.9% 3.3% 4% Denver, Colo. 7.1% 8.7% 5.2% Pittsburgh, Penn. 7.8% 4.4% 4% Portland, Ore. 5.7% 9% 2.9% Charlotte, N.C. 10.7% 8.9% 3.1% Sacramento, Calif. 5.7% 9.1% 5.7% San Antonio, Texas 5.6% 8.4% 3.2% Orlando, Fla. 9.8% 12.6% 4.8% Cincinnati, Ohio 6.7% 7.2% 2.5% Cleveland, Ohio 6.8% 6.2% 1.4% Kansas City, Mo. 9.3% 8.6% 3.2% Las Vegas, Nev. 14.5% 11.9% 4.4% Columbus, Ohio 8.6% 6.8% 2.8% Indianapolis, Ind. 9.4% 6.2% 1.3% San Jose, Calif. 26% 8.4% 7.9% Austin, Texas 6.1% 6.7% 3.3%Just because home values are rising more slowly in some of the most popular cities in the U.S. doesn’t mean that buyers can rest easy.
“Despite the slowdown, home values are still growing faster than their historic pace in almost all large markets, and it’s far too soon to call it a buyer’s market,” Zillow senior economist Aaron Terrazas wrote in the report. “But it’s clear that the winds that have boosted sellers over the past few years are ever-so-slightly starting to shift.”
Nationally, home values rose 8% year-over-year in July, which is nearly a full percentage point faster than in 2017. The median home value is now $218,000—the highest value ever reported. And some cities such as San Francisco have seen home values buoyed thanks to buyers who are hunting around for better deals.
Other signs of weariness on the part of house-hunters are appearing. Existing home sales fell to a 2.5-year low in July as a larger number of buyers either found themselves priced out of the market or decided to take a wait-and-see approach in case home prices dropped. Mortgage rates have also dropped in recent weeks because of buyers deciding to exit the market for the time being.
