SEATTLE – The second quarter of 2013 showed continued appreciation in home values across the nation and in Rhode Island, according to the Zillow Real Estate Market Report.
The Providence metro area experienced a 2.4 percent increase in year-over-year home value as measured by the Zillow home value index, “the median value for all homes in a given area, not just those that have recently sold.” This growth reflects the 5.8 percent national increase.
Home value appreciation accelerated in the second quarter. According to the report, national home values rose only 0.25 percent in the first quarter. Homes across the nation increased 2.4 percent in value since then, marking the sixth consecutive quarter of appreciation.
Providence metro area homes appreciated 2.3 percent in value in the same period, according to the Zillow report.
Sacramento, Las Vegas and San Francisco were the metro areas with the largest year-over-year appreciations with 29.5, 29.4 and 25.5 respectively.
“The U.S. housing market as a whole is currently not experiencing a bubble, but in many places it sure must feel like one, with some markets experiencing annual home value appreciation approaching 30 percent,” Zillow Senior Economist Svenja Gudell said in a statement. “Homeowners are feeling a sense of whiplash after years of depreciation, but this kind of market behavior won’t last.”
Gudell added that he predicts the market will “normalize” and “become much more steady than it has been in these past six months.”
The Zillow forecast anticipates a 1.5 percent increase in Providence metro area home value in the coming year, and a five percent increase nationally.
Rent appreciation has slowed in the state and across the country. The Providence metro area Zillow rent index fell 1.3 percent since last year and 0.3 percent in the past month.
National rents decreased 0.5 percent this quarter, the first decline in rent after nine quarters of appreciation or staying flat, though rents increased 1.6 percent annually.
Foreclosures fell 4.1 percent in Rhode Island, with 3.69 foreclosed homes per 10,000. The state’s rate of foreclosed homes is slightly lower than the national rate of 4.96 homes per 10,000 during the second quarter.