The construction of new houses was the catalyst for the growth of the housing market
The total value of the US housing market is 49% higher than before the start of the epidemic in February 2020.
Among the metropolitan areas, New York, Los Angeles, San Francisco, Boston and Miami are the most expensive housing markets.
Florida now boasts the second most valuable real estate in the country, surpassing New York. California maintains first place.
The US housing market rebounded impressively in 2023 after a short-lived recession at the end of last year. The total value of the US housing market has soared by more than $2.6 trillion in the past year, according to a new Zillow® analysis.
The total value of the US housing market – the sum of Zillow's estimated value of every home in the US – is now just under $52 trillion, which is $1.1 trillion higher than the previous peak reached last June. While a small portion of this growth can be attributed to a 0.7% increase in the average US home value during this period, the powerhouse behind this jump was new construction.
"A steady flow of new homes hit the market this coming spring and summer, helping to reduce the deep inventory deficit and increase the overall value of the market," said Orf DiBongoy, Zillow senior economist. “Despite the presence of higher mortgage rates, which deterred some homebuyers and kept many existing homeowners on the sidelines, there are enough buyers left to keep the market going. Builders recognized the unmet demand and responded by starting more projects. New home sales are up this year. While sales of existing homes have fallen, and should make up a larger portion of the home sales pie as long as rates remain high."
The four most expensive metro areas have remained unchanged over the past five years: New York, Los Angeles, San Francisco and Boston. A new entrant, Miami, earned fifth place, jumping all the way from ninth place in May 2021 to edge Washington, DC.
Of the six markets where housing has gained the most value since the beginning of the epidemic, four are in Florida: Tampa (+88.9%), Miami (+86.6%), Jacksonville (+82.4%) and Orlando (+72.3%). It's no surprise, then, that Florida has surpassed New York as the state with the second-most valuable housing market. Large population growth is one reason for strong new construction figures in Florida, and increased competition for existing homes has also helped drive up home values.
California remains huge with more than $10 trillion of value in its housing market; Almost 20% of the national total. Florida, New York, Texas and New Jersey round out the top five.