Home values across the US are rising at the fastest pace since 2006.
The value of a home in the US has increased 8.7 per cent since last April to an average of $215,600, according to Zillow.
Meanwhile, in all 50 states and the District of Columbia the average cost of rent rose 2.5 per cent in the past year to $1,449.
A breakdown shows that home values are rising fastest in San Jose, California, Las Vegas and Seattle.
The average price for a home in San Jose is $1,263,900, up 26 per cent.
The value of a home in the US has increased 8.7 per cent since last April to $215,600, according to Zillow with the biggest increase in San Jose, California
In Las Vegas there is a 16.5 per cent rise and growth of 13.6 per cent in Seattle.
California cities Sacramento and Riverside reported the greatest increases in median rent.
‘Home values are rising faster than we’ve seen in a very long time: The spring home shopping season has been a perfect storm of strong demand and tight supply,’ said Zillow senior economist Aaron Terrazas.
‘Sluggish new construction has exacerbated the supply situation and homes that are hitting the market, are moving very quickly once they do. Americans are also in a spending mood, boosted by recent tax cuts and rising wages,’ he said.
‘Millennials who long delayed becoming home owners, are out in force, a shift we’re also seeing in softer rent appreciation,’ Terrazas added.
The Federal Housing Finance Agency’s report shows first-quarter home prices have risen 6.9 per cent from last year.
Homeowners taking additional cash out by refinancing also rose to 61 per cent in the first quarter – the highest since the third quarter of 2008, according to FHFA records.
Residents in Seattle are moving onto houseboats to avoid the soaring housing market costs.
An average condo is now a staggering $470,000, while a house in $757,000.
More families and young people are moving into the water to get the Seattle views and location at a fraction of the cost.
Seattle had an increase of 13.6 per cent, trailing Las Vegas at 16.5 per cent