Pre-Housing Bubble Burst Levels Appearing in the Industry
Though Atlanta has been enduring one of the wettest summers in history, it is also experiencing one of the “hottest” in terms of real estate, according to online real estate database Zillow. Zillow’s second quarter real estate market reports showed that home values increased 2.4 percent from the first quarter to the second quarter of 2013, the largest quarterly gain since 2005. Monthly appreciations are also growing strong with growth up 0.9 percent from May after a slow start earlier in the year.
Changes happening across the board
Not only did appreciation rates increase, the appreciation took place across the nation. Markets that have been slower to recover from the 2008 bubble burst, including Atlanta and other Southeastern markets, are finally beginning to show improvement. Of the 389 metropolitan areas Zillow Real Estate Market Reports tracks, 72 percent of the areas reported home value increases. All of the top 30 metro areas experienced appreciation by the end of the second quarter. Sacramento (29.5 percent), Las Vegas (29.4 percent) and San Francisco (25.5 percent) were the markets with the largest gains.
Foreclosure rates are also improving, back to pre-bust levels
While appreciation rates are increasing, foreclosure rates have finally returned to levels before the crisis. Foreclosure rates fell 0.7 from the first to second quarter. In the past quarter, 4.96 out of every 10,000 homes nationwide were foreclosed. Over the past 12 months, foreclosure rates have fallen more than 35 percent. Rates are now comparable to December 2006, pre-housing bust levels. This marks a major victory, and sigh of relief, for the US housing market.
A continued brighter outlook
The recovery seems to be extending into the future with no sign of decline. Zillow Home Value Forecast expects national home values to increase 5 percent over the next year. The Zillow Home Value Forecast also predicts that the 30 largest metro areas, except New York, will continue to show home value appreciation with Sacramento, Phoenix and Riverside, Calif. predicted to boast the highest appreciation rates. It seems as if the past quarter wasn’t just a fluke; it is a sign of what’s to come.
What does this mean for you as a homebuyer?
“Homeowners are feeling a sense of whiplash after years of depreciation, but this kind of market behavior won’t last,” said Zillow Senior Economist Svenja Gudell. “Investors are starting to pull out of some markets and regular buyers are coming back.”
According to Zillow’s reports, rates are slowly becoming steadier and will eventually normalize. The normalization will allow homebuyers to make more informed decisions, as the markets won’t be fluctuating as much as they have been in years past. Buyers are instilled with more confidence and are ready to begin purchasing homes again.
What does this mean for you as a seller?
As the market improves, more homes are becoming freed from their negative equity. As a result, more homeowners will be more willing and able to put their house on the market. Sellers may see more competition, but they are able to sell their homes at better prices than years past. The housing market progress, including improved foreclosure rates and appreciation rates across the nation, will benefit both buyers and sellers alike.