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Home Values Up 6.6% in August, Monthly Gains Decelerate

August home values saw their largest year-over-year gain since 2006, according to the latest Home Value Index (HVI) release from ""Zillow"":http://www.zillow.com/.

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Zillow's HVI climbed to $162,100 in August, up 0.4 percent month-over-month and 6.6 percent annually--the largest yearly gain since July 2006, when values rose 7.9 percent.

""August marked the end of one of the hottest summer home shopping seasons in years, as home value appreciation rates continued their rocket ride upward--perhaps dangerously so in some metro areas,"" said Zillow [COLUMN_BREAK]

chief economist Stan Humphries, explaining that rapid growth can't continue as the market normalizes.

""We are already beginning to see moderation in the monthly pace of home value appreciation, which will be good for the market overall and in the long term,"" he added.

The vast majority--85 percent--of the 382 metros covered in the August release experienced annual home value appreciation, Zillow reported. Among the 30 largest metro markets, 20 posted annual appreciation of at least 10 percent. Many of the most notable improvements occurred in California, with Sacramento (34.1 percent), Riverside (29.7 percent), San Francisco (28.1 percent), and San Jose (24 percent) taking four of the top five spots. (The one remaining slot went to Las Vegas, which saw an annual gain of 30.6 percent.)

For the 12 months ending August 2014, national home values are forecast to rise another 5.2 percent to approximately $170,500, according to Zillow's Home Value Forecast. Once again, California is expected to lead the way, with Riverside (21.9 percent), Sacramento (19.2 percent), and Los Angeles (13.2 percent) experiencing the highest appreciation rates.

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