The Bay Area Tops List of Best Markets for Sellers; Baltimore and Miami Are the Best for Buyers

SEATTLE, Feb. 14, 2017 /PRNewswire/ -- San Francisco and San Jose, Calif. top Zillow's list of the best markets for sellers. Buyers in Baltimore and Miami will have the most negotiating power when shopping for a home, according to the latest Zillow® analysis.

Denver, Seattle and Sacramento, Calif. join the two Bay Area metros on the list of markets that favor sellersⁱ. Homes in these five metros stay on the market for an average of just 54 days and rarely feature slashed prices; bidding wars are common in these hot housing markets.

West Coast powerhouse markets like Seattle, Denver and Portland have been driving the housing market over the past year. Strong job growth is attracting newcomers, causing demand for homes to skyrocket. Portland and Seattle have experienced extremely high home value growth over the past year, with Portland leading the nation for the past 12 monthsⁱⁱ. In 2016, Portland home values grew 14 percent and Seattle home values grew 12 percent.

Buyers will face less competition and have more bargaining power in Baltimore, Miami, Philadelphia, Chicago and Houston, which are Zillow's top five markets for buyers -- homes in these metros stay on the market for an average of 103 days. Six out of the 10 top buyers' markets have home values appreciating more slowly than the home values in the nation as a whole. In Philadelphia, home values grew less than 5 percent in 2016, and less than 4 percent in Baltimore.

To determine which markets favor buyers and sellers, Zillow looked at the length of time a home stays on the market and the percentage of listings with a price cut. In buyers' markets, homes are on the market longer and price cuts occur more frequently. Homes in a sellers' market sell quickly and have fewer homes with a price cut.

"The overall recovery has been more robust in many coastal markets, especially on the west coast, with fast home value appreciation, strong job growth and solid income gains," said Zillow Chief Economist Dr. Svenja Gudell. "Many of these markets are also experiencing above-average housing demand coupled with limited inventory, putting sellers in the driver's seat. On the flip side, a number of markets nationwide continue to struggle with slower job growth, weaker home value appreciation and higher rates of negative equity, giving buyers more negotiating power. Whether you live in a buyers' or sellers' market, there are a few things you can do to stand out from the crowd. If you're a buyer in a sellers' market, it's important to get preapproved for a loan so you can move as quickly as possible. It's also helpful to find an agent with a track record of winning bidding wars. If you're a seller in a buyers' market, consider making small improvements to your home to make it more attractive, and be prepared to be a bit more patient waiting for offers to come in. Every housing market is different, so it's important for buyers and sellers to educate themselves on the type of market they're in."

Despite unfriendly market conditions for buyers, especially in the nation's hottest markets, experts predict things will change in the near future -- the majority of experts surveyed in a recent Zillow survey^v said they expect the overall housing market to switch from a seller's market to a buyer's market in 2018 or 2019 as the market begins to slow. Zillow expects national home values to slow down from a nearly 7 percent appreciation rate to 3.5 percent by the end of 2017.

Zillow
Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Zillow also sponsors the bi-annual Zillow Housing Confidence Index (ZHCI) which measures consumer confidence in local housing markets, both currently and over time. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ:Z and ZG), and headquartered in Seattle.

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ⁱ For the top 10 list of the best buyers' and sellers' markets, Zillow ranked the nation's 35 largest housing markets.
ⁱⁱ Portland has been the top market with the fastest home value appreciation since January 2016 among the nation's 35 largest housing markets.
ⁱⁱⁱ The percentage of current listings on Zillow with a price cut during the month.
^iv The median days on market of homes sold within a given month, including foreclosure re-sales.
^v The Zillow Home Price Expectations Survey surveyed 111 experts between October 28 and November 15, 2016. The survey was conducted by Pulsenomics LLS on behalf of Zillow, Inc. and asked the experts about their expectations for the housing market.
^vi The Zillow Home Value Index (ZHVI) is the median estimated home value for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. It is expressed in dollars, and seasonally adjusted.
^vii November 2016 data. All other "Days on Zillow" data is from December 2016.

SOURCE Zillow