ZILLOW GROUP, INC. SEATTLE, April 22, 2016 /PRNewswire/ -- Home values are rising the fastest among entry-level homes in more than half of the largest U.S. housing markets, according to first quarter Zillow® Real Estate Market Reports.(i) Rising home values in this segment of the market can be attributed to a lack of supply, with 10 percent fewer homes for sale this year compared to last.
The median value of entry-level homes, those in the bottom third(ii) of the market, rose the most over the past year in Denver, up 20 percent, followed by Portland and Dallas. There are 13 percent fewer entry-level homes available in Denver than there were a year ago. The number of entry-level homes available declined the most in Portland. There are 40 percent fewer entry-level homes available in Portland than there were a year ago.
The findings signal difficult times ahead for first-time homebuyers looking to enter the market. Going into home-shopping season this spring, buyers will find fewer homes in the bottom and middle of the market -- the homes most affordable for first-time buyers. The trend also highlights the different experiences buyers are having in the recovering housing market. Buyers looking for the most expensive homes will find slower price growth, a larger selection, and less competition this spring than entry-level buyers who are likely to face stiff competition, bidding wars, and very few homes to choose from.
"It's going to be a tough home-buying market this spring, especially for first-time buyers or even people looking to move up into a slightly more expensive home," said Zillow Chief Economist Dr. Svenja Gudell. "In order to stand out in a competitive market, buyers should get pre-approved for a loan, find an agent who has experience with bidding wars, and consider coming in at the asking price, so the seller knows they're serious."
In all of the largest U.S. housing markets, more than a third of the homes available for sale are in the most expensive segment -- in the top third of the overall housing stock in the market. In nine markets, top-tier homes make up more than half of the inventory.
The most expensive homes on the market are more likely to have a price cut, a signal that there's less demand for top-tier homes. The share of top-tier listings with a price cut has increased 1.6 percentage points over the past year.
Metropolitan First Quarter Bottom- Bottom- Middle- Middle- Top-Tier Top-Tier
Area 2016 Zillow Tier Tier Tier Tier Percent Percent
Home Value Percent Percent Percent Percent Home Inventory
Index (ZHVI) Home Inventory Home Inventory Value Change
Value Change Value Change Increase
Increase Increase
--- -------- --------
United States $186,200 n/a -10.4% n/a -10.4% n/a -1.9%
------------- -------- --- ----- --- ----- --- ----
New York, NY $384,100 -0.8% -9.0% 1.8% -3.6% 3.5% 4.7%
------------ -------- ---- ---- --- ---- --- ---
Los Angeles-Long
Beach-Anaheim, CA $565,400 6.2% -26.3% 6.2% -11.3% 8.1% 1.3%
------------------ -------- --- ----- --- ----- --- ---
Chicago, IL $193,800 0.7% -14.2% 3.1% -10.5% 1.0% 2.0%
----------- -------- --- ----- --- ----- --- ---
Dallas-Fort Worth,
TX $182,100 14.7% -27.5% 13.0% -32.5% 11.2% -10.1%
------------------ -------- ---- ----- ---- ----- ---- -----
Philadelphia, PA $204,400 0.9% -2.0% 1.9% -6.4% 1.3% 0.5%
---------------- -------- --- ---- --- ---- --- ---
Houston, TX $172,100 7.7% n/a 6.4% n/a 2.8% n/a
----------- -------- --- ---- --- ---- --- ----
Washington, DC $364,100 2.8% -10.8% 2.0% -0.7% 1.0% 2.7%
-------------- -------- --- ----- --- ---- --- ---
Miami-Fort
Lauderdale, FL $230,600 11.7% -3.6% 10.5% 7.8% 6.3% 15.4%
--------------- -------- ---- ---- ---- --- --- ----
Atlanta, GA $163,000 7.3% -11.5% 6.3% -11.9% 5.5% 1.3%
----------- -------- --- ----- --- ----- --- ---
Boston, MA $387,400 3.2% -13.1% 4.9% -4.8% 4.5% 14.6%
---------- -------- --- ----- --- ---- --- ----
San Francisco, CA $806,600 11.0% -17.7% 11.5% -6.7% 12.1% 1.7%
----------------- -------- ---- ----- ---- ---- ---- ---
Detroit, MI $123,100 -3.2% 2.0% 6.4% -20.6% 2.8% -3.6%
----------- -------- ---- --- --- ----- --- ----
Riverside, CA $304,200 10.0% -3.8% 6.9% -11.8% 2.7% 1.7%
------------- -------- ---- ---- --- ----- --- ---
Phoenix, AZ $219,200 11.2% -28.5% 8.4% -11.6% 4.2% -5.3%
----------- -------- ---- ----- --- ----- --- ----
Seattle, WA $382,700 12.6% -32.4% 11.7% -24.4% 10.7% -16.8%
----------- -------- ---- ----- ---- ----- ---- -----
Minneapolis-St
Paul, MN $219,400 5.2% -7.9% 4.5% -12.8% 2.1% 4.2%
-------------- -------- --- ---- --- ----- --- ---
San Diego, CA $506,100 6.0% -25.5% 5.7% 2.3% 5.2% 3.9%
------------- -------- --- ----- --- --- --- ---
St. Louis, MO $141,900 2.3% -3.0% 5.5% -10.9% 5.4% -6.6%
------------- -------- --- ---- --- ----- --- ----
Tampa, FL $163,600 10.3% -28.1% 8.9% -20.4% 6.2% -12.4%
--------- -------- ---- ----- --- ----- --- -----
Baltimore, MD $244,800 1.3% -3.9% 1.5% -3.9% 0.6% -3.2%
------------- -------- --- ---- --- ---- --- ----
Denver, CO $333,500 20.3% -12.7% 15.7% 5.4% 10.6% -12.7%
---------- -------- ---- ----- ---- --- ---- -----
Pittsburgh, PA $126,700 2.9% 8.6% 1.8% 1.7% 3.0% 9.3%
-------------- -------- --- --- --- --- --- ---
Portland, OR $322,000 16.2% -39.5% 14.8% -38.7% 13.5% -19.7%
------------ -------- ---- ----- ---- ----- ---- -----
Charlotte, NC $159,800 4.3% -34.7% 5.1% -34.5% 4.4% -16.6%
------------- -------- --- ----- --- ----- --- -----
Sacramento, CA $339,700 13.0% -22.3% 8.7% -21.2% 7.1% -8.6%
-------------- -------- ---- ----- --- ----- --- ----
San Antonio, TX $150,200 8.2% n/a 6.7% n/a 4.5% n/a
--------------- -------- --- ---- --- ---- --- ----
Orlando, FL $184,100 7.9% -23.1% 7.9% -16.0% 4.7% -4.8%
----------- -------- --- ----- --- ----- --- ----
Cincinnati, OH $143,400 4.0% -18.2% 3.9% -20.0% 2.9% -9.1%
-------------- -------- --- ----- --- ----- --- ----
Cleveland, OH $125,500 -1.3% -7.9% 2.5% -11.0% 2.2% 0.8%
------------- -------- ---- ---- --- ----- --- ---
Las Vegas, NV $203,200 9.1% -11.1% 9.2% -8.3% 5.8% 6.8%
------------- -------- --- ----- --- ---- --- ---
Columbus, OH $154,600 4.8% -24.1% 5.7% -13.7% 4.2% -3.0%
------------ -------- --- ----- --- ----- --- ----
Indianapolis, IN $130,200 2.9% -8.7% 2.7% -22.4% 3.7% -11.8%
---------------- -------- --- ---- --- ----- --- -----
San Jose, CA $956,500 10.5% -14.2% 12.6% 1.5% 12.1% 7.5%
------------ -------- ---- ----- ---- --- ---- ---
Austin, TX $247,500 10.1% n/a 8.7% n/a 6.8% n/a
---------- -------- ---- ---- --- ---- --- ----
Virginia Beach, VA $210,900 0.2% 1.1% 1.1% 2.4% 1.1% 0.0%
------------------ -------- --- --- --- --- --- ---
About Zillow
Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Zillow also sponsors the bi-annual Zillow Housing Confidence Index (ZHCI) which measures consumer confidence in local housing markets, both currently and over time. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ:Z and ZG), and headquartered in Seattle.
Zillow is a registered trademark of Zillow, Inc.
(i) The Zillow Real Estate Market Reports are a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Real Estate Research. For more information, visit www.zillow.com/research/. The data in Zillow's Real Estate Market Reports are aggregated from public sources by a number of data providers for 928 metropolitan and micropolitan areas dating back to 1996. Mortgage and home loan data are typically recorded in each county and publicly available through a county recorder's office. All current monthly data at the national, state, metro, city, ZIP code and neighborhood level can be accessed at www.zillow.com/local-info/ and www.zillow.com/research/data. (
ii) Homes in each metropolitan region are assigned to the bottom, middle or top tier of homes based on their estimated home value. Each tier contains one-third of the homes in the metro region, and the thresholds defining each tier are computed separately for each metro.
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SOURCE Zillow
