Home values dip in July

New data shows that home values slipped for the first time since the market recovered four years ago.

According to real estate company Zillow, Home values dropped by 1 percent last month to an average of $179,900. On an annual basis, home value appreciated by 3 percent, 0.4 percent less than in June.

Zillow chief economist Svenha Gudell said that the data will be welcome news for buyers on the market.

"This slight dip in home values is a sign of the times. Many people didn't think it was happening, but it is: we're going negative," Gudell said in a statement. "We've been expecting to see a monthly decline as markets return to normal. However, this is not like the bubble bust. We're not going to see 10 percent declines. The market is leveling off, and it's good news, particularly for buyers, because it will ease some of the competitive pressure."

Zillow explained that the dip in home values may also help improve the inventory of homes for sale. As the appreciation of homes slows, more sellers are likely to list their homes to avoid prices dropping further. In turn, the lower prices will attract news buyers to the market.

Zillow covers 517 metropolitan areas in the U.S. Of those, the market in 204 slowed last month, including major areas such as Washington D.C. and Cincinnati.

Appreciation rates fell from June even in markets that saw a rise in home values in July. Denver, Dallas, San Francisco and San Jose all had home value growth in the double digits last month as their appreciation rates fell. 

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