Home values have boomed over the past five years, with New York, Boston and Nashville seeing double-digit gains in median per square foot.
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The median price per square foot has increased 52.7% since 2019, according to Realtor.com’s latest market report released Tuesday. That metric means home values are growing at more than twice the rate of consumer price inflation, which has risen 23% over the same period.
Danielle Hale
“The specifics vary by market, but the data suggests opportunities remain for many sellers,” Realtor.com chief economist Danielle Hale said of the rapid rise in home values. “While mortgage rates remain well above many existing levels enjoyed by homeowners, but this opportunity benefits sellers who do not need a replacement mortgage, such as investors or second home owners looking for an exit, or asset-rich homeowners looking to downsize from their existing home.
Over the past year, the median home sale price increased 0.3% from $441,000 to $442,500. However, the median price per square foot, which Realtor.com says can be considered a more accurate indicator of home value, is up 3.8% from May 2023.
Nearly half of the top 50 U.S. metros have seen median per square foot increases since 2019, with New York (84.7%), Boston (72.9%) and Nashville, Tennessee (68.6%) seeing the largest increases.
“The percentage change between the median listing price and the median price per square foot suggests that the share of inventory of smaller and more affordable homes has grown during this time, helping to push down the median price, even as Based on – square foot prices increased further,” the report reads.
“Nationally, the median price per square foot has experienced impressive growth from pre-pandemic levels.”
Over the past seven months, rising home values have encouraged more sellers to stop waiting, with the number of homes for sale growing 32.5% compared with the same period last year. Homes in the $200,000 to $350,000 range experienced the most significant boom, with inventory in this price range increasing 46.6% over last year.
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