California’s housing market holds significant value, with six of the nation’s most valuable housing markets located in the state.
According to a new report by Zillow, the total value of US housing has increased by over $2.6 trillion in the past year, reaching just under $52 trillion. This represents a $1.1 trillion increase from the previous peak in June 2022.
Despite predictions of a downturn due to higher borrowing costs, the housing market has defied expectations. Limited supply and the lock-in effect, which has caused current mortgage borrowers to hold onto their low-cost loans, have driven up prices nationwide. The increase in Zillow’s estimated value for every US home is attributed to a 0.7% rise in average prices and a surge in new construction.
Among the top metro areas, California dominates the rankings:
- Los Angeles-Orange County: Ranked second in the US with a value of $3.7 trillion, experiencing a slight increase of $3 billion or 0.1% since the June 2022 peak.
- San Francisco: Ranked third at $1.8 trillion, experiencing a decrease of $176 billion or 9% since June 2022.
- San Diego: Ranked ninth at $994 billion, experiencing an increase of $10 billion or 1% since June 2022.
- San Jose: Ranked eleventh at $909 billion, experiencing a decrease of $50 billion or 5% since June 2022.
- Riverside: Ranked fourteenth at $785 billion, experiencing a decrease of $25 billion or 3% since June 2022.
- Sacramento: Ranked nineteenth at $482 billion, experiencing an increase of $27 billion or 5% since June 2022.
Florida’s real estate boom has propelled Miami to become the fifth-largest metropolitan housing market in the US. Miami has surpassed Washington DC and other cities after climbing from the ninth spot in May 2021.
Home values in Miami have soared by over 80% since the start of the pandemic, with similar increases in Tampa, Jacksonville, and Orlando. Zillow attributes these rapid price increases in Florida to substantial population growth in the state.
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Zillow’s data reveals that Florida has overtaken New York as the second most valuable housing market in the US. While prices in California have declined since June 2022, residential property values in Florida have risen by $159 billion during the same period.
“Despite the presence of higher mortgage rates, which deterred some home shoppers and kept many existing homeowners on the sidelines, enough buyers remained to keep the market moving,” noted Orphe Divounguy, a senior economist at Zillow.
The top five states in terms of housing value are:
- California: $10 trillion, representing a decrease of $344 billion or 3% since the June 2022 peak.
- Florida: $3.8 trillion, representing an increase of $159 billion or 4% since June 2022.
- New York: $3.7 trillion, representing a decrease of $9 million or 0.2% since June 2022.
- Texas: $3.4 trillion, representing an increase of $50 million or 1.5% since June 2022.
- New Jersey: $1.8 trillion, representing an increase of $213 million or 13% since June 2022.
Bloomberg News and Jonathan Lansner, business columnist for the Southern California News Group, contributed to this report.
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