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Home Values Up 7.1% in November, Slowdown Expected

National home values continued to improve in November, with more than three-quarters of tracked metros experiencing increases, ""Zillow"":http://www.zillow.com/ revealed in its latest ""Real Estate Market Reports"":http://zillow.mediaroom.com/index.php?s=159&item=404.

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Zillow's Home Value Index (HVI) stood at $168,900 in November, an increase of 0.6 percent month-over-month. On a yearly basis, the index was up 7.1 percent, reflecting a slight slowdown from the 7.3 percent peak recorded in the summer.

""Much of this year's rapid growth in home values can be attributed to very strong demand, as low mortgage interest rates, relatively low home prices and a slowly improving economy helped draw buyers into the market,"" said Zillow chief economist Dr. Stan Humphries. ""Those dynamics are now giving way to more moderating influences, including rising mortgage interest rates, flagging investor demand and slowly increasing for-sale inventory.""

Out of the 485 markets tracked by the company, 77.1 percent experienced home value appreciation between October and November, with 19.6 percent reporting declines. Annually, about 88 percent saw home values increase. Major markets where home values rose the most over the last year include Las Vegas (+30.9 percent), Riverside (+29.2 percent), and Sacramento (+25 percent).

For the next 12-month period, Zillow anticipates a fairly significant leveling off in appreciation rates, with values rising an estimated 4.6 percent to a national average of $176,731.

""This slowdown in home value appreciation will contribute to a more balanced market, and will help to ease some emerging affordability problems in a handful of very hot markets, particularly in California,"" Humphries said.

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