SAN FRANCISCO (CBS SF) – According to the latest report from the real estate database, property prices in the 50 largest US markets have seen their biggest monthly jump in seven years, with the largest increases in metropolitan areas of San Jose and San Francisco company Zillow.
The Seattle-based firm’s August Real Estate Market Report shows a typical property value of $ 256,663, up 0.7% from July, fueled by the shortage of real estate inventories and strong demand from buyers. Values rose in 48 of the 50 largest markets.
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However, on the San Jose subway, the typical home value last month was $ 1,224,366, up 2.1% from the previous month and a whopping 10.3% year over year. On the San Francisco subway, the typical August home value was $ 1,127,066, up 0.8% from the previous month and 2.7% year over year, the report said.
Meanwhile, rental rates in the Bay Area continued to fall, with a typical one-bedroom San Jose subway rental falling 3.8% year over year to $ 3,219. Rental rates on the San Francisco subway are down 4% year over year to $ 3,167, according to the report. Before the February pandemic, rents in San Jose and San Francisco rose 3.5% and 2.4%, respectively, year over year.
Nationwide, average rents in August fell 0.3% from July to $ 1,771 – the largest monthly decline since 2017, with rents falling most dramatically in San Jose, San Francisco, New York / Newark, and Boston.
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For homes in the market, Zillow stated that they were typically signed after 14 days, which is 14 days faster than at this point in 2019.
“American home buyers have faced a historic shortage of supply this summer, and that scarcity is now reflected in a rapid surge in property values after a sluggish start to the home buying season this spring,” the said Zillow economist Jeff Tucker in a press release. “Builders are trying to catch up with demand and rising prices should encourage more potential sellers to get off the sidelines and off the list. Still, the shortage of inventory is likely to tilt the property markets unusually in favor of sellers this fall. “
The report said that in the future, due to the stock deficit, price pressures are likely to continue into the fall while demand remains stable. Buyers are pulling the trigger after delaying purchases earlier this spring and summer.
There was a prospect of further price reductions for the tenants, particularly in the Bay Area and in the New York area.
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“Rental demand has been weighed down by still-rising unemployment as well as some tenants logging out of expensive markets and their ability to work remotely during the pandemic,” Tucker said. “The rental market may also feel an early gust of demographic headwinds as the bumper crop of millennials make the leap to home ownership in their early 30s.”