As you read on, statistics from Zillow will indicate that the country’s housing market has reached a critical juncture. Record values have been documented from coast to coast and you can find the 10 highest valued U.S. real estate markets listed below. Meanwhile, I’ve acquired some data from the experts at ASU on the state of Arizona’s economy and housing market.
Lee McPheters at ASU’s W.P. Cary School of Business prepared an Update & Outlook for Arizona and the Western States. Figures for the outlook of employment in Arizona far exceeds the previous peak in 2007. Of all the states included, Arizona ranked 6th for growth of Gross State Product at the beginning of 2018, and 5th in Personal Income Gains with an unemployment rate of only 4.7, the lowest in 10 years and just slightly higher than the national average. However it’s important to note, as regards the Arizona real estate market, according to statistics in the ASU study, housing prices are currently rising more rapidly than wages. The greatest risk to Arizona’s economic forecast is the state of the U.S. business cycle.
Among all 50 states, Arizona ranks 7th in Non-Farm Job Creation. Arizona’s leading job-growth industries are: Construction, Business Services, Food Services, Health Care, Manufacturing, Financial, Educational (private), Retail, Transportation & Warehousing, State Government, with Construction accounting for 9% of all jobs. Overall, Arizona is expected to add 71,000 jobs in 2019. This is the 5th year in a row for growth in the construction industry and 2019 is expected to see another 10% increase.
Arizona’s population growth in 2019 is expected to be 1.5%, roughly equivalent to increases in 2017 and 2018. Of the states included in the study, Arizona holds the position of 6th fastest in population growth yielding approximately 106,000 new residents in the coming year. The Phoenix Metropolitan Area adds 240 new residents per day. Much of Arizona’s population growth can be attributed to domestic migration as indicated in the graphic below.
Housing Market at Never-Before-Seen Record Worth
By Suzanne De Vita
The housing market is at a new peak in the recovery, according to a recently released report by Zillow—but whether homeowners will leverage the value is uncertain.
Cumulatively, $1.9 trillion was added to the housing market in the past year, bringing the market’s overall value to $33.3 trillion—a first, the report shows. Since 2012, the housing market has recovered $10.9 trillion, and, today, is $4 trillion above the bubble-era record.
Bar none, California is driving the recovery. In the last six years, the California housing market has recovered $3.7 trillion in value, or 33.4 percent of the nation’s overall recovery—the largest share of the states. For perspective, New York accounted for 6.1 percent of the nation’s recovery—the country’s second-highest share.
Of the 35 major markets in the U.S., four in California, including San Francisco and San Jose, are highly valued; however, when comparing the major markets, New York/Northern New Jersey is No. 1, valued at $3 trillion.
The 10 highest-valued states, according to the report, are:
1. California
2018 Cumulative Value: $7.9 trillion
Gains Since 2012: $3.7 trillion
2. Florida
2018 Cumulative Value: $2.4 trillion
Gains Since 2012: $937.9 billion
3. Texas
2018 Cumulative Value: $1.7 trillion
Gains Since 2012: $495.2 billion
4. Massachusetts
2018 Cumulative Value: $1.1 trillion
Gains Since 2012: $320.5 billion
5. New Jersey
2018 Cumulative Value: $1.1 trillion
Gains Since 2012: $182.7 billion
6. Illinois
2018 Cumulative Value: $952.2 billion
Gains Since 2012: $183.6 billion
7. Pennsylvania
2018 Cumulative Value: $942.8 billion
Gains Since 2012: $160.4 billion
8. Virginia
2018 Cumulative Value: $912.5 billion
Gains Since 2012: $158.6 billion
9. Colorado
2018 Cumulative Value: $833.8 billion
Gains Since 2012: $343.3 billion
10. North Carolina
2018 Cumulative Value: $805 billion
Gains Since 2012: $204.7 billion
Worth It?
For homeowners, is it best to capitalize on the gains, or hold off? The future of the housing market is murky, says Aaron Terrazas, senior economist at Zillow.
“Seen from the rearview mirror, 2018 was a year of unusually strong, stable home value growth across the country, but cracks in the foundation are clearly starting to emerge,” Terrazas says. “During the second half of the year, appreciation slowed sharply in the priciest corners of the country while it picked up in affordable hotspots. Periods of stability often precede periods of instability, and the outlook for 2019 is certainly both cloudier and blurrier than the outlook a year ago.
“Housing wealth may have touched new highs this year, but home value gains don’t translate into dollars in the bank account unless homeowners opt to sell or borrow against their home and, in contrast to previous housing booms, many Americans have been more reluctant in recent years to spend against their home’s worth,” says Terrazas. “Moving toward an uncertain future, that may prove to be a prescient choice.”
For more information, please visit www.zillow.com. Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at sdevita@rismedia.com. Reprinted with permission from RISMedia. ©2019. All rights reserved.
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Bill Salvatore / Arizona Elite Properties
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