[ad_1]
WASHINGTON, DC – Whether you are looking in the Midwest, the South or elsewhere in the country, the housing market is still hot.
“There’s still quite a lot of demand for real estate for buyers,” said Gretchen Hudson, a Michigan real estate agent.
This demand for housing is a side effect of the COVID-19 pandemic.
“House prices are really going through the roof,” said Whit Blanton, general manager of Forward Pinellas in the Tampa Bay, Florida area.
How high the prices are also depends on where you live and the value of a property.
“There really was no rhyme or reason for east versus west, north versus south,” said Ken H. Johnson, dean of the College of Business at Florida Atlantic University. “Right now there is a shortage of inventory pretty much everywhere.”
In some places, however, good values can still be found, in others, according to Johnson, residential properties are now “overrated”.
“We thought that was good information,” he said.
Johnson and a team of researchers recently looked back on 26 years of housing data. They compared the historic rise in home prices to what they would expect today to see which markets are overvalued.
Here is what they found.
Out of the 100 real estate markets surveyed, Boise, Idaho topped the list of overvalued real estate markets. Home prices there are 80% higher than they should be based on the history of home prices there.
Boise is joined by several cities in Utah, such as Ogden and Salt Lake City, as well as Austin, Texas, Detroit, Phoenix and Las Vegas, among others.
1. Boise, ID
2. Austin, TX
3. Ogden, UT
4. Provo, UT
5. Detroit, Michigan
6. Spokane, WA
7. Salt Lake City, UT
8. Phoenix, AZ
9. Las Vegas, NV
10. Stockton, California
“They can’t grow fast enough,” Johnson said of these cities. “So the housing supply is scarce.”
What does that mean? It’s a great time for sellers, but Johnson had some advice for buyers.
“If I switched to these markets, I would be concerned about buying at the top of the cycle,” he said. “I would probably be vulnerable, even if the prices could be high I would be vulnerable to wanting to rent.”
However, there were some offers in some cities.
A surprise to the researchers was Honolulu, Hawaii.
“We were shocked that Honolulu was at the bottom,” said Johnson. “Honolulu, Hawaii has almost 4% off historic prices. If you are moving to Hawaii, now is a really good time to buy. “
Honolulu ranks at the bottom of the list of 100 markets, followed by Virginia Beach, Baltimore, and New York City and New Orleans. All are places that are currently considered a good buy.
100. Honolulu, HI
99. Virginia Beach, Virginia
98. Baltimore, MD
97. New York, NY
96. Baton Rouge, LA
95. Washington, DC
94. New Orleans, LA
93. Albany, NY
92. Little Rock, AR
91. Hartford, CT
So is there any chance of a housing crisis, similar to the Great Recession 15 years ago? Johnson doesn’t think so.
“We are in a fundamentally different economic situation today than 15 years ago,” he said. “Are some markets prone to falling or a downturn? Yes, but it doesn’t seem as dramatic as what we saw a decade and a half ago. Many markets are well prepared for this. “
However, Johnson also said there is more to consider when buying a home than just the cost. Emotional factors also play a role.
“You bought a house that was just what you wanted and tailored for you,” he said. “So it’s much more than just a strict financial investment.”
Still, it’s an investment that’s still worth investigating closely. For a detailed look at the study results, click here.
[ad_2]
