The total value of the housing stock in the United States grew to a record-high $29.6 trillion in 2016, according to a new Zillow analysis. The housing market saw a strong year of appreciation, growing 5.7% in value, or $1.6 trillion.
The U.S. housing market has regained all the value lost during the housing crisis. The cumulative value of all homes in the U.S. declined by $6.4 trillion between 2006 and 2012 as the housing market collapsed.
A home is typically the biggest part of an individual or family’s wealth, and the cumulative value of the U.S. residential housing stock is similarly significant to the national economy. The U.S. GDP is an estimated $18.7 trillion, nearly $10 trillion less than the value of all homes in the country.
Los Angeles and New York metros hold the highest shares of the country’s overall housing value, at 8.6% and 8%, respectively. The next most valuable metro is San Francisco, worth 4.2% of the overall housing value.
While several markets are now more valuable than they were at the height of the housing bubble, about 60% of the markets in the U.S. are still below the maximum values reached during the bubble years. For example, Chicago is still about $134 billion below the highest value it reached in 2006.
“Housing is incredibly important to us personally and to the economy as a whole,” said Zillow Chief Economist Dr. Svenja Gudell. “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% this year, a pace that will likely mean some American families are priced out of homeownership.”
Renters this year paid $478.5 billion, a $17.7 billion increase from 2015. About 635,000 new renter households formed in 2016, contributing to the amount of rent spent even as rent appreciation slowed. Apartment renters spent nearly $50 billion more than renters of single-family homes, as more multifamily construction became available this year.
Renters in the New York/Northern New Jersey metro paid the most this year, spending nearly $55 billion on rent. Los Angeles ($2.5 trillion/$38.6 billion), Chicago ($772.7 billion/$14.9 billion), Dallas-Fort Worth ($456.9 billion/$11.1 billion), and Philadelphia ($589.2 billion/$8.5 billion) round out the top five.
SOURCE: Zillow Group HQ, 1301 Second Avenue, Floor 31, Seattle, WA 98101