Zillow is a full-blown housing market bull—predicting that U.S. home prices will jump 6.5% by July 2024

Back in February, Zillow’s housing economists boldly predicted that U.S. home prices had bottomed out and would continue to rise. Up 0.5% over the next 12 months.

In the months leading up to that call, U.S. home prices tracked by the Zillow Home Value Index had not only begun to climb again, but hit new all-time highs. The rise was driven by tailwinds from tight inventory levels, which proved strong enough to outweigh headwinds from mortgage rate shocks.

Zillow has raised its home price forecast several times amid a rebound in U.S. home prices. Zillow’s latest revised forecast sees U.S. home prices rising 6.5% between July 2023 and July 2024, up from 6.3% forecast last month.In the long run, U.S. house price tracking Keith Hiller The average annual growth rate since 1975 has been 5.5%.

“Limited for-sale inventory continues to push up home prices, even though mortgage rates remain high,” Zillow housing economists wrote. “Slightly more than half the number of homes listed for sale in July compared with the same month in 2019, 7 The number of new listings hitting the market in July was 29% lower than was typical for the same period before the pandemic. This shortage has intensified competition for homes for sale. It took just 12 days for homes to be under contract (or ‘pending’) in July, That’s a week and a half faster than was typical in 2018 and 2019.”

While Zillow economists expect national home prices to rise by 6.5% over the next 12 months, their forecasting model predicts that 120 of the nation’s 400 largest housing markets will see increases of 7.0% or more over the next 12 months increase.

There’s not just one unifying factor; these 120 real estate markets are spread across the country. They can be found in the West (such as Santa Maria, California), the South (Tampa), the Midwest (Indianapolis), and the Northeast (Scranton, Pennsylvania).

While Zillow thinks U.S. home prices have bottomed out — CoreLogic and AEI Housing Center Believe it too — not every company agrees.company like Moody’s Analytics and Morgan Stanley Think US house prices have more room to give up, which will happen between now and the end of 2024.