Total value of U.S. housing reaches all-time high
The total value of all the housing stock in the United States has never been worth more than it is right now, according to a new report from Zillow.
The report says the total value of U.S. housing stock grew to a total of $29.6 trillion in 2016, marking an all-time high.
Zillow’s report shows that housing stock showed an increase of $1.6 trillion from 2015, a 5.7% increase in value to reach that record level.
That increase also means that the U.S. housing market has now regained all of the value that was lost during and after the housing crisis.
According to the report, the cumulative value of all homes in the U.S. declined by $6.4 trillion from 2006 to 2012 as the housing market collapsed.
But now, all of that value has been gained back.
It’s important to note that Zillow’s report is a national total of housing values. As the report shows, there are more than a few markets where housing values have not completely recovered from the crisis yet.
In fact, according to Zillow’s report, there are several markets that are now more valuable than they were at the height of the housing bubble, but roughly 60% of the markets in the U.S. are still below the maximum values reached during the bubble years.
As an example, the Chicago market is still approximately $134 billion below the highest value it reached in 2006.
According to Zillow’s report, the Los Angeles and New York metro areas have the highest shares of the country's overall housing value, at 8.6% and 8%, respectively.
San Francisco checks in at third on that list, with Bay Area housing carrying 4.2% of the nation’s overall housing value.
As Zillow notes in its report, while the record high in U.S. housing value shows that the housing market is still moving in the right direction, the increase in value could also price more prospective buyers out of the market.
“Housing is incredibly important to us personally and to the economy as a whole,” said Zillow Chief Economist Svenja Gudell.
“The U.S. housing stock is worth more than ever, which is a sign of the ongoing housing recovery,” Gudell added.
“As buying a home gets more expensive, affordability remains a concern for many, and these numbers highlight just how much people are spending on housing,” Gudell said. “The total value of the housing stock grew nearly 6% this year, a pace that will likely mean some American families are priced out of homeownership.”
And many of those families that are priced out of homeownership end up turning to renting to put a roof over their family’s heads, as Zillow’s report also shows.
According to data analyzed by Zillow, in 2016, renters in this country paid $478.5 billion in rent, which represents a $17.7 billion increase from 2015.
Zillow’s report also shows that approximately 635,000 new renter households formed in 2016, which contributed to the amount of rent spent even as rent appreciation slowed.
According to Zillow’s report, apartment renters spent nearly $50 billion more than renters of single-family homes, as more multifamily construction became available this year.