Home values fell for the first time in nine months in August, declining 0.1 percent month-over-month to a Zillow Home Value Index of $152,100, according to the August Zillow Real Estate Market Reports. Home values were up on a year-over-year basis, however, increasing 1.7 percent from August 2011. Major markets that saw home values edge downward from July to August after experiencing prior increases included the Chicago (-0.7 percent), New York (-0.3 percent) and Boston (-0.2 percent) metros. Home values continued to climb in the Phoenix (1.6 percent) and Miami-Ft. Lauderdale (one percent) metros, although the rate of increase was smaller in August.
U.S. rents, however, continued to rise, climbing 0.2 percent month-over-month and 5.9 percent year-over-year to a Zillow Rent Index of $1,280. Nationally, rents have increased in seven out of the past 12 months. Rents rose by double-digit percentages year-over-year in the Chicago metro (12.8 percent), the Baltimore metro (12.4 percent) and the Philadelphia metro (10.5 percent).
"Home values took a small hit in August, but this shouldn't be cause for alarm," said Zillow Chief Economist Dr. Stan Humphries. "The back half of the year is always softer than the front half, and this year is no exception. We've been encouraging folks to focus on the longer term trends and not monthly blips. Home values will rise a little and fall a little, month by month, in the near future, but we believe the overall trend will remain positive albeit still below normal rates of appreciation."
Foreclosures continued to decline in August, with six out of every 10,000 homes in the country being foreclosed. That was down from 6.4 out of every 10,000 homes in July.
