According to real estate research firm Zillow, home values in the U.S. have reached a bottom and are rebounding. The Zillow Home Value Index for the second quarter rose on an annual basis for the first time since 2007, increasing 0.2 percent year-over-year to $149,300. What's more, July marks the fourth month in a row that prices have risen.
According to real estate research firm Zillow, home values in the U.S. have reached a bottom and are rebounding. The Zillow Home Value Index for the second quarter rose on an annual basis for the first time since 2007, increasing 0.2 percent year-over-year to $149,300. What's more, July marks the fourth month in a row that prices have risen.
Zillow also found that 53 of the 167 metropolitan areas it monitors-or about one-third-posted annual increases in home values. The largest increase came in Phoenix, where home values are up 12.1 percent from the second quarter of 2011 to the second quarter of 2012.
Looking ahead, two in five, or 67 of the 156 markets monitored by Zillow, are expected to see increases in home values over the next year, with the largest increases expected in the Phoenix metro (9.9 percent) and the Miami metro (6.1 percent). Overall, Zillow expects U.S. home values to rise 1.1 percent.
"After four months with rising home values and increasingly positive forecast data, it seems clear that the country has hit a bottom in home values," said Zillow Chief Economist Stan Humphries. "The housing recovery is holding together despite lower-than-expected job growth, indicating that it has some organic strength of its own."
Still, Humphries tempered his optimism with a dose of foreboding. "There is still some risk as we look down the foreclosure pipeline and see foreclosure starts picking up," he said. "This will translate into more homes on the market by the end of the year, but we think demand will rise to absorb that, particularly in markets where there are acute inventory shortages now. Looking forward, we expect home values to remain relatively flat as the market works through a backlog of foreclosures and high rates of negative equity."