The collective American housing value grew to a record $29.6 trillion in 2016, marking 5.7 percent appreciation, or additional $1.6 trillion, according to a recent Zillow analysis. With home prices now fully recovered since the housing crash and continued growth projected for the foreseeable future, some experts worry that prospective homebuyers could be pushed to the sidelines as affordable housing becomes more scarce.
Dr. Svenja Gudell, Zillow Chief Economist, explains, “Housing is incredibly important to us personally and to the economy as a whole. The U.S. housing stock is worth more than ever, which is a sign of the ongoing housing recovery. As buying a home gets more expensive, affordability remains a concern for many, and these numbers highlight just how much people are spending on housing. The total value of the housing stock grew nearly 6 percent this year, a pace that will likely mean some American families are priced out of homeownership.”
While the appreciation experienced in 2016 is record breaking, roughly 60 percent of housing markets nationwide remain below the values reached during the bubble years, according to the analysis. Still, renting is becoming an increasingly popular option. There were 635,000 new renter households in 2016, which translated to a $17.7 billion dollar increase over 2015.