According to data from real estate firm Zillow, the US housing market has grown 57% since 2020, equivalent to $20 trillion. Zillow's data reveals a persistently expensive real estate market with continuously escalating home values, despite high mortgage rates that have deterred many potential buyers and forced sellers to lower prices.
Overall, the total value of homes in the world's largest economy stands at $55 trillion.
However, this year's price growth has been uneven. New York leads the way, with the total value of homes increasing by $216 billion in the past year. Following closely behind are New Jersey, Illinois, and Pennsylvania.
"In the Northeast, demand still outstrips supply. Looking at New York's housing inventory, you'll see that the number of homes currently listed is only half of what it was before the pandemic. This explains the significant price increases there," explains Orphe Divounguy, a senior economist at Zillow.
 |
Single-family homes in San Marcos, California on 25/3/2024. Photo: Reuters |
Single-family homes in San Marcos, California on 25/3/2024. Photo: Reuters
Conversely, the size of the housing market in Florida, California, and Texas has decreased by billions of USD this year. These states previously attracted buyers with their sunny climates and less stringent pandemic lockdown regulations. However, demand has waned in the past few years.
Real estate brokers in Florida, California, and Texas told CNN that housing inventory is rising. Many sellers are being compelled to reduce prices or offer additional incentives to attract buyers.
"Real estate is cyclical. We are currently in a down cycle," says Sharon Ross, a real estate broker in Florida. One contributing factor is the sharp increase in homeowners' insurance and property taxes. Florida, California, and Texas are particularly vulnerable to the increasing severity of natural disasters due to climate change, which has driven up home insurance premiums.
"I've seen buyers cancel transactions after receiving their insurance quotes," Ross said.
A report last month by financial services company Intercontinental Exchange revealed that 85% of counties in Florida experienced a decline in home prices compared to a year ago. The report also indicated that real estate prices in California, Texas, Colorado, and Arizona have fallen by more than 3% from their post-pandemic peaks.
However, new construction is contributing to the overall value of housing in the southern and southwestern states, according to Zillow. In Texas, for example, over 20% of the price increase since 2020 is attributed to new construction.
Ha Thu (CNN, Reuters)
