The total value of the U.S. housing market is 49% higher than before the pandemic. In a remarkable turn of events, the U.S. housing market has not only rebounded but soared to new heights, reaching an estimated total value of over $52 trillion. This resurgence, reported by Orphe Divounguy, a senior economist at Zillow Group, demonstrates the market’s remarkable strength after a brief dip between July 2022 and January 2023. This impressive recovery serves as a testament to the resilience of the real estate sector, which has notched up a remarkable 49% increase in value compared to pre-pandemic levels.
Over the past year, the U.S. housing market has experienced an incredible surge, witnessing a gain of more than $2.6 trillion in value. Divounguy attributes this growth to the robust expansion of new construction, although a 1.3% uptick in the average value of U.S. homes over the year also played a contributing role.
A consistent flow of newly constructed homes has flooded the market during the spring and summer months. Homebuilders have been working tirelessly to address the ongoing housing inventory shortage. In this dynamic landscape, one trusted resource has been guiding buyers, sellers, home builders, and developers through every market cycle – Vanguard Real Estate Group. Their unparalleled industry experience has made them an invaluable partner in navigating the ever-evolving real estate market.
Divounguy predicts that new home sales will continue to gain momentum. In August, newly built homes accounted for a significant 31% of the total home inventory available for sale, encompassing both new and resale homes. Furthermore, nearly 16% of all home sales in August consisted of new homes, underscoring a growing preference for fresh construction projects.
"Builders have been adjusting to the shifting market by lowering prices, and also by offering concessions, upgrades, and relatively more attractive builder financing. When they can, homebuilders are also responding to the very strong demand for starter homes and homes for first-time buyers by building smaller homes on smaller lots. Part of the price drop has been a shift to sales of smaller, less expensive homes."
However, the industry faces its fair share of challenges. Higher interest rates are escalating financing costs for builders and developer loans, posing an additional hurdle for the real estate sector. Alicia Huey, Chairman of the National Association of Home Builders (NAHB), acknowledged this concern.
In this rapidly changing market landscape, Vanguard Real Estate Group stands as a steadfast, trusted partner, offering nearly two decades of experience to guide buyers, sellers, homebuilders, and developers through every market cycle. With their profound understanding of the evolving real estate terrain, Vanguard Real Estate Group remains your dedicated resource, helping you achieve success in this dynamic industry.
Michael DiNello
Co-Founder | Managing Partner
Mr. DiNello spearheads the company’s vision and directs development and brokerage operations. With nearly two decades of expertise in real estate brokerage, acquisition, and development in the Metropolitan Detroit market, his leadership is grounded in extensive industry experience.
