U.S. home values rose 0.5% from February to March, according to new data from Zillow. This marks the largest monthly increase in the Zillow Home Value Index (ZHVI) since May 2006, when home values also rose 0.5%. However, the ZHVI fell 3.1% year-over-year to $146,200.
Zillow predicts that 19 of the 30 metro areas covered by the ZHVI will either reach a bottom this year or have already reached a bottom. Several of those are expected to see significant home value increases in the next 12 months, including the Phoenix (6.5%), Miami-Fort Lauderdale (5.6%) and Tampa (2.5%) metros, according to the forecast.
Nationally, Zillow is forecasting that home values will fall 0.4% over the next 12 months, with many months showing no change or slight appreciation late this year. Zillow adds this could mean that U.S. home values could reach a bottom in late 2012.Â
In the first quarter, the rate of homes foreclosed fell to 2009 levels, with 7.4 out of every 10,000 homes foreclosed, which is significantly down from 8.3 out of every 10,000 homes foreclosed in February.
‘For people who have been waiting to time their home purchase close to market bottom, it's time to start shopping,’ says Zillow Chief Economist Stan Humphries. ‘When the bottom will hit will vary by market, and it's nearly impossible to time a purchase exactly right. But home prices are not the only part of the equation. Buyers also should take into account the possibility that rising mortgage rates could offset any further home value declines that may occur.
‘From an economic perspective,’ Humphries adds, ‘the latter part of the first quarter is full of positive news as the spring selling season gets under way. While it is unlikely that national home values will continue to rise at this rate through the rest of the spring and summer, it is undeniable that we are seeing sparks of life in the housing market.’