A recent report by Zillow has found some housing markets in the United States are beginning to cool down, but expects home prices to rise by 3.1% over the next eleven months. Zillow’s Home Value Index showed prices rose 6.6% last month to reach $175,000, which is the slowest annual pace in the last year.
The hottest markets remain on the West Coast, topped by San Francisco, San Jose and Seattle. Here sellers are able to achieve quick sales and asking prices are high. However home hunters can still find bargains in certain areas including Providence, Philadelphia and Cleveland where more homes went up for sale. According to the article in Propertywire, the index showed home values increased by 0.1% last month compared to July, with an overall increase of 6.6% compared to August last year.
The Zillow report shows sellers living in Dallas, Seattle and the Bay Area have the most negotiating power, and the final sale prices achieved are close to the asking price or even above. Buyers looking to purchase a home will find the Midwest and Northeast offers the most favorable conditions as they are less likely to be forced into bidding wars seen in larger cities and on the West Coast.
Apparently a sellers’ market isn’t necessarily where home prices are rising, but refers to a market where properties are up for sale for shorter periods of time, and where price reductions occur less frequently. Often properties are sold at close to or greater than the asking price. In comparison properties in buyers markets tend to be listed for longer and are more likely to incur price cuts and tend to be sold for less than their asking price.
Real estate experts point out that as the real estate recovery continues, several different types of markets are beginning to emerge. These include markets that recovered quite quickly after the recession ended, but which are now cooling down, and those that are still bumping along the bottom, as well as markets that remain red-hot. They point out that buyers and sellers face different challenges in different areas, and that strategies that work well in one particular market won’t necessarily work in another.
Nationally home prices have now increased month on month for more than two years, even though the pace of price appreciation has slowed down as more properties are listed for sale. The number of properties up for sale on Zillow in August had increased by 20.6% year on year, and by 2.1% compared to the previous month.