The US housing market has soared in value over the past five years, reaching a record $55 trillion. According to Zillow, this is a 57% increase since 2020, meaning Americans added $20 trillion to housing wealth in just half a decade. Even as mortgage rates remain high, home prices have continued to climb, keeping the housing market historically expensive. Zillow’s data, released Monday, shows a clear split in market growth across different states.
New York saw the largest increase last year, adding $216 billion in housing value, more than any other state. New Jersey, Illinois, and Pennsylvania followed closely behind. “Demand continues to outpace supply in the Northeast,” said Orphe Divounguy, a senior economist at Zillow. “Housing inventory in New York is only half of what it was before the pandemic. That has driven values higher for existing homes.” Limited supply combined with strong buyer demand has pushed prices up sharply, particularly in metropolitan areas. Sellers in these markets are benefiting from increased home equity, even as first-time buyers face affordability challenges.
In contrast, pandemic-era boom states like Florida, California, and Texas experienced declines in 2025. Once popular for sunny weather and relaxed Covid restrictions, these markets are now seeing cooling demand. Real estate agents report growing inventory and price reductions. “We’re in a down cycle,” said Sharon Ross, a South Florida agent. “Sellers are getting lower offers, and I’m helping them adjust expectations.” Rising home insurance costs and property taxes are a key factor. Areas prone to natural disasters, such as Florida, California, and Texas, are especially affected. “Some buyers canceled deals after seeing their insurance quotes,” Ross noted.
A report from Intercontinental Exchange last month found that 85% of Florida counties saw price drops from the previous year. California, Texas, Colorado, and Arizona also saw prices fall more than 3% from post-pandemic highs. While overall demand has softened, new home construction has supported values in Sun Belt markets. In Texas, new homes accounted for more than one-fifth of the state’s value gains since 2020—the highest share outside of Utah. Florida ranked fourth in this measure. “New construction has created pockets of affordability,” Divounguy said. “These markets give people a chance to enter the housing ladder and access homeownership opportunities.”
The surge in US housing wealth reflects both regional disparities and broader trends. While some areas struggle with declining prices and rising costs, other markets benefit from limited supply and ongoing development. For buyers and sellers, understanding these trends is crucial. The housing market’s $20 trillion growth over five years underscores the long-term value of property investment, even as short-term conditions vary widely across the country.
