Looking Back at A Year of Home Value Changes

Home values are changing quickly throughout the U.S. as we move into 2024. This map shows Zillow’s home values index changes across the country over the past 12 months. A few key observations on this data:

·        Home values dropped in nearly one-third of U.S. counties over the past year. This is a major increase from the year prior, where 92% of all counties had home value increases.

·        10 states saw home values drop in more than half their counties in the past year.

·        The West, Mountain West, and Deep South are home to a disproportionate number of the counties seeing home values fall. Texas’s changes really stand out on the map. More than 80% of Texas’s counties saw home values go down. In some cases, especially in West Texas, values dropped by double digits.

·        The South saw a significant number of counties with home value declines after being among the leaders in home value (and migration) in years prior. Large chunks of Tennessee, South Carolina, Alabama and Arkansas lost home value last year. Even Florida, which once seemed an unstoppable juggernaut in home prices, had 25 counties experience home value declines, especially through Central Florida.

·        In other places, home value increases continued, despite perceived economic headwinds. The Northeast had a particularly strong year, with nearly every county between Maryland and Maine seeing home values rise. Many areas of the Midwest, and Mid-Atlantic saw continued price increases as well.

·        One big exceptions to the Northeastern home value rise was New York City, which saw values decline in every borough again last year. Philadelphia, too, had home values decline this year, but the change was very minor.

·        The average home value change in large urban counties rose a little bit faster than the average U.S. county, at 1.4%. This comes after several years of relative underperformance, and may signal an ongoing urban rebound (except in New York City, it seems).

·        Meanwhile the average home value in rural counties dropped over the past year – though the drop was less than 1%.

Overall, the map highlights how much location matters when discussing home value changes, and how prevailing narratives about hot and cold markets can change pretty quickly. If we rely too heavily on what just happened to determine what will happen next, we are going to make a lot of bad predictions. Which is why we at Homeworthi keep our eyes firmly on the fundamentals of place - supply & demand, benefits & costs. As long as we know why housing markets change, we are better able to identify when to pounce on market opportunities.