Zillow Group, Inc., the Seattle-based real estate marketplace company, in their latest Zillow® Market Report revealed that the runaway monthly increases in home values and rents slowed in August. This paves the way, Zillow says, for a strong but more manageable housing market for this coming fall. Another month of rising inventory and more for-sale listings taking price cuts are giving buyers more options and potentially less stress as they shop for their next home.
Home value appreciation had been accelerating on a monthly basis since January 2021 but finally eased off the throttle, moderating from 1.97% month-over-month growth in July down to 1.75% growth in August. While this will be good news for buyers looking for any signs of relief, it still represents the third-largest monthly growth in Zillow records.
In remarks prepared for the release of the Market Report, Nicole Bachaud, economic data analyst at Zillow said, “The strong recovery of inventory and initial lift off the gas pedal for home value appreciation is indicative of balance returning to the market. But the major demand drivers that have pushed the market to extremes this year are still present — we’re moving from a white-hot midsummer to somewhere closer to red hot as we head into the fall.”
In the rental market, monthly rent growth had been accelerating since January, but finally took a step back in August, decelerating to 1.7% growth in August from July’s record-high 2%. Despite this, August’s 11.5% annual appreciation is the largest in Zillow records going back to 2015. Typical U.S. rents measured by the Zillow Observed Rent Index (ZORI) are $1,874, nearly $200 higher than this time last year.
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Buyers Take Note: Housing Market Easing from White Hot to Red Hot