Home prices have begun to rise amid an increase in demand, interest rates at record lows and a tight supply of properties for sale. The residential market is showing strength even as job growth weakens and concerns that the European debt crisis will hurt the U.S. economy, said Stan Humphries, Zillow’s chief economist. The country’s unemployment rate has exceeded 8 percent for 41 straight months.
Phoenix had the largest increase in home values, with a 12 percent gain in the first quarter, followed by Miami, where they rose 6.4 percent, Zillow said.
Among cities where values dropped, Chicago fell 5.8 percent from a year earlier, the biggest decline among the 30 largest metropolitan areas that Zillow follows. Atlanta, where prices fell 4.9 percent, had the second-largest decrease, the company said.