The US housing market has soared in value over the last few years. A new LendingTree report found that the total value of owner-occupied housing units across the biggest 50 metro areas in the US has reached $23.48 trillion.
That figure rose by about 38% from 2019 to 2022, from about $17.02 trillion in the year before the pandemic.
During the pandemic, many homebuyers were able to capitalize on record-low mortgage rates, sparking a buying frenzy as work-from-home trends allowed people to move more easily. In 2020 and 2021, many Americans secured mortgage rates of about 3% for a 30-year fixed rate loan. Cheaper borrowing costs, in turn, drove up the price of homes across the country.
Mortgage rates have since soared in conjunction with the Federal Reserve's aggressive interest rate hikes, yet prices for homes have not fallen as they typically do. That unaffordability has sidelined prospective buyers and "locked in" current owners.
Redfin data shows that a mere 15.5% of homes were considered "affordable" last year, down from 20.7% in 2022.
Meanwhile, a decade of under-construction has created a multi-year inventory shortage, putting additional upward pressure on prices.
In any case, LendingTree found the 50 biggest metros make up 64.1% of the total value of the entire US housing market, which hovers at $36.6 trillion.
New York, Los Angeles, and San Francisco led the way as the most valuable metro areas, with the total value of each city's homes worth $2.75 trillion, $2.31 trillion, and $1.39 trillion, respectively.
Memphis, Birmingham, and Buffalo rounded out the least valuable metros with respective total values of $88.4 billion, $90.4 billion, and $93.1 billion.
"While some may fear that an imminent housing crash will wipe away much of the value held in residential real estate, the truth is that the housing market doesn't actually appear as though it's on the precipice of a major collapse," LendingTree senior economist Jacob Channel said.
"Because of this, the total value of homes in the U.S. will probably keep climbing as time goes on, and, over the coming decades, we'll likely see even more metros with trillion-dollar aggregate home valuations."
