88 of the top 100 metro areas have achieved full recovery of previous "boom-era" home values
December 3, 2020 - HSH.com, a trusted online resource for mortgage data, content and expertise, releases today its latest Home Price Recovery Index, a quarterly analysis of changing home values in the nation’s top 100 metropolitan housing markets. Developed by HSH, a premiere consumer destination for mortgage information and rate shopping since 1979, HPRI reveals markets with home prices at or above previous "boom era" peaks and those that have not yet completely recovered lost value.
The latest study examines home values in the largest 100 metropolitan areas from 1991 through the third quarter of 2019. Home prices are rising broadly, although increases in value remain uneven. Six new markets joined the ranks of the recovered in the latest quarter, the largest number since the study series began five years ago.
HSH.com’s "Home Price Recovery Index" uses the Federal Housing Finance Agency's (FHFA) Home Price Index for insight on housing market values. By this reference, 98 of the 100 largest metro areas saw quarter-to-quarter increases in home values, and just two markets posted declines in home value in the third quarter of 2020 compared to the second.
The housing market is currently running strong, with record high home prices, thin inventories of homes for sale and a pace of sales last seen in 2006; all 100 markets posted year over year increases in value.
A faster pace of rising home prices in many metros during the latest quarter enabled six metro areas to reach values last seen during boom-era peaks more than 13 years ago. These are:
- Allentown-Bethlehem-Easton (PA-NJ)
- Baltimore-Columbia-Towson (MD)
- Newark (NJ-PA MSAD)
- Riverside-San Bernardino-Ontario (CA)
- Virginia Beach-Norfolk-Newport News (VA-NC MSA)
- Wilmington (DE-MD-NJ MSAD)
However, despite years of economic expansion and improving real estate markets, 12 of the nation’s most populated metro areas have not yet seen values recover to previous highs.
HSH.com’s "Home Price Recovery Index" uses the Federal Housing Finance Agency's (FHFA) Home Price Index for insight on housing market values. By this reference,98 of the 100 largest metro areas enjoyed quarter-to-quarter increases in home values, and no metros showed any decline in value when compared against the same period a year ago.
| Areas with greatest pricing recovery | Percent value now above “boom era” price peak |
| 1. Denver-Aurora-Lakewood, CO | 107.59% |
| 2. Austin-Round Rock-Georgetown, TX | 100.71% |
| 3. Dallas-Plano-Irving, TX | 83.88% |
| Areas with largest recovery gaps | Percent increase needed to regain price peak |
| 1. Bakersfield, CA | 11.74% |
| 2. Bridgeport-Stamford-Norwalk, CT | 9.59% |
| 3. Stockton, CA | 7.54% |
It is important to note that many markets have seen significant price recoveries since hitting their bottom values, but that many still have not fully recovered the lost value. In fact, there are still three metro areas where this is the case, despite a doubling or more of ‘bust-era’ bottom home values. Two of those are in the group with the largest value gap yet to close.
| Areas nearing recovery | Percent increase needed to regain price peak |
| 1. Las Vegas-Henderson-paradise, NV | 0.83% |
| 2. Chicago-Naperville-Evanston, IL | 2.17% |
| 3. Hartford-east Hartford-Middletown, CT | 2.62% |
Important takeaways
- Record low mortgage rates have stoked gains in home values. 74 markets now have values that are more than 10% above previous peak, a figure up from 68 just a quarter ago, and an increase of 13 metros compared against the third quarter of 2019.
- Only a single metro area still has a double-digit value gap yet to fill. Better still, the size of the gaps in the markets with the greatest chasms continues to shrink, with differences as small as 2.62% in the Hartford-East Hartford-Middletown CT metro. Eight others markets have less than a 10% value differential to overcome to achieve full recovery, which may occur in the next few quarters.
- There were no new entrants into the most-recovered group. Metros in positions one through six held fast in the latest quarter, but surging values in the Boise City, ID metro pushed it into the #7 slot, bumping the Houston-The Woodlands-Sugar Land, TX metro to 8, in turn moving the Buffalo-Cheektowaga, NY metro to 9. Colorado Springs, CO rounded out the top 10 list. To join the "most recovered" group, a metro now must have a value more than 62% above its previous "boom-era" peak value to make the cut.
- The markets with the largest gaps to fill didn't change, but positions were shuffled. Except for the Cape Coral-Fort Myers, FL metro at #4 and Bakersfield, CA which retained the title of the market with the widest gap yet to close, all other markets moved up or down in this group list as values improved at different speeds during the quarter.
See the full analysis here: https://www.hsh.com/finance/real-estate/home-price-recovery.html
Homeowners interested in seeing how their home's value has changed over time are encouraged to use HSH.com's free “Home Value Estimator.” The tool allows users to select their market from 100 metropolitan areas and enter the time frame in which they've owned their home; changes in the home’s value during this ownership period are revealed and a current price estimate based on housing cost trends in the selected metro area is provided.
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