1. Wealth, inequality and Housing
Svenja Gudell, Ph.D., Chief Economist
@SvenjaGudell

2. The median U.S. home value is almost back to all-time highs
-22.6%
Peak-to-trough
-4.9%
Peak-to-current
+5.4%
Year-over-year
Source: Zillow Home Value Index (June 2016)

3. Home value growth in Portland, Denver and Dallas is the fastest in the U.S.
Source: Zillow Home Value Index (June 2016)

4. Mortgage affordability

5. Nationwide, the share of income spent on a mortgage is well below historic norms
Source: Zillow Mortgage Affordability, Rent Affordability (2016 Q1)

6. Mortgage interest rates are near all-time lows, a boon for potential home buyers
Source: Freddie Mac: Primary Mortgage Market Survey (July 2016)

7. Housing starts have been on the rise, but remain well below pre-recession highs
Source: U.S. Census Bureau, New Residential Construction

8. Year-over-Year Change
Inventory shortages are particularly acute among homes in the bottom and middle thirds of the market
U.S. Inventory
Year-over-Year Change
-8.3%
Bottom Third
-11.2%
Middle Third
-1.1%
Top Third
Source: Zillow For-Sale Inventory (Seasonally Adjusted, Smoothed (June 2016))

9. Median home values by market segment
U.S. Home Values
Source: Zillow Home Value Index (June 2016)

10. Tight inventory, particularly at the bottom, is helping push home values up faster at the bottom and middle
U.S. Home Value Appreciation
Source: Zillow Home Value Index (June 2016)

11. Income growth has been weak, especially for those making the least
U.S. Household Income
Source: Zillow analysis of U.S. Census Bureau ACS data, IPUMS

12. Weak income growth and rapid appreciation, even with very low mortgage interest rates, means homes are becoming more unaffordable, more quickly for bottom-third home buyers
U.S. Mortgage Affordability
Source: Zillow Mortgage Affordability Index (2015 Q2)

13. The difference in affordability is especially striking in expensive markets
San Francisco Affordability
Source: Zillow Mortgage Affordability, Rent Affordability (2016 Q1)

14. Year-over-Year Change
Low inventory drives home value growth
San Francisco Inventory
Year-over-Year Change
-0.8%
Bottom Third
+0.6%
Middle Third
+16.0%
Top Third
Source: Zillow For-Sale Inventory (Seasonally Adjusted, Smoothed (June 2016))

15. San Francisco Home Value Tiers
San Francisco Home Values
Source: Zillow Home Value Index (June 2016)

16. San Francisco bottom-third homes are appreciating fastest
San Francisco Home Value Appreciation
Source: Zillow Home Value Index (June 2016)

17. San Francisco bottom-third incomes have remained relatively flat while top-third incomes are growing steadily
San Francisco Household Income
Source: Zillow analysis of U.S. Census Bureau ACS data, IPUMS

18. Affordably buying a bottom-third home on a bottom-third income is incredibly difficult
San Francisco Affordability
Source: Zillow Mortgage Affordability (2015 Q2)

19. Rental Affordability

20. Nationwide, the share of income spent on rent is well above historic norms
Source: Zillow Mortgage Affordability, Rent Affordability (2016 Q1)

21. Rents are growing fastest in Seattle and Portland
Source: Zillow Rent Index (June 2016)

22. San Francisco rents continue to rise in both bottom-third and top-third tiers
Source: Zillow Rent Index (June 2016)

23. Affordably renting a bottom-third home on a bottom-third income is virtually impossible
San Francisco Rent Affordability
Source: Zillow Rent Affordability (2015 Q2)

24. Wealth Inequality

25. Negative equity continues to decline nationally
Source: Zillow Negative Equity (2016 Q1)

26. But homes in the bottom third remain disproportionately impacted by negative equity
Middle Third
Top Third
Source: Zillow Negative Equity (2016 Q1)

27. Negative equity often leads to foreclosure
Negative equity often leads to foreclosure. And entry-level homes were hit the hardest by the foreclosure crisis
Bottom Third
Middle Third
Top Third
Source: Zillow analysis of property-level Zestimates and the Zillow Home Value Index

28. Throughout the entire recovery, foreclosed homes showed greater annual appreciation than homes in general
Source: Zillow analysis of property-level Zestimates and the Zillow Home Value Index

29. Job losses in manufacturing have stabilized, while the tech and healthcare industries continue to add jobs quickly
Source: Zillow Analysis of U.S. Bureau of Labor Statistics: Current Employment Statistics (March 2016)

30. The best areas for social mobility for low-income children include the Bay Area, Southern California and the Northeast
Source: Zillow analysis of data from the Equality of Opportunity Project (Chetty, Hendren, Kline and Saez, 2014)

31. But those areas are also areas where housing costs are highest
Source: Zillow analysis of data from the Equality of Opportunity Project (Chetty, Hendren, Kline and Saez, 2014) and Zillow Home Value and Rent Indices

32. Higher housing costs means homes are less affordable in areas with the most social mobility for low-income children
Source: Zillow analysis of data from the Equality of Opportunity Project (Chetty, Hendren, Kline and Saez, 2014) and Zillow Mortgage Affordability