The continuing housing inventory shortage caused home values to rise 0.7 percent in August, according to Zillow’s latest Real Estate Market Report.
Zillow said the month-to-month increase in August was the biggest in nearly seven years, as home value growth accelerated in 48 of the 50 largest markets. The August average home value was $256,663.
“American home shoppers faced an historic shortage of listings to choose from this summer, and that scarcity is now reflected in rapidly appreciating home values after a sluggish start to the home shopping season this spring,” Zillow Economist Jeff Tucker said in a release.
“Builders are racing to catch up with demand, and rising prices should encourage more potential sellers to come off the sidelines and list,” he said. “Still, the shortage of inventory should keep housing markets unusually tilted in sellers' favor this autumn.”
According to the report, year-over-year home values were 5.1 percent in August, the largest annual rise since March 2019.
Zillow said the highest year-over-year increases in home values were in Phoenix (10.5 percent); San Jose, Calif. (10.3 percent); and Seattle (9.2 percent). The smallest year-over-year gains in home values among major metros were in Chicago (1.9 percent); New York (2.3 percent); and San Francisco (2.7 percent).