Study: More U.S. Housing Markets at or Near Pricing Peaks
Home prices appear to have peaked in a growing number of U.S. markets, according to a July analysis by researchers at 麻豆传媒映画 and
贵础鲍鈥檚 , Ph.D., and FIU鈥檚 , Ph.D., rank the 100 most overvalued housing markets by analyzing their premiums 鈥 the percentage above the long-term pricing trend that consumers must pay in order to buy a property. The larger the premium, the more overpriced the market.
In July, premiums declined from June in 27 markets, mostly west of the Mississippi River, and 22 of the 27 also experienced price declines. The following were among the metros with falling premiums and average prices: Austin, Texas; Denver; Minneapolis; Los Angeles; Phoenix; Salt Lake City, Utah; San Francisco; and Seattle.聽聽
In June, premiums declined in 12 markets and average prices fell in seven.
A falling premium is a classic sign of a home price peak, according to Johnson, an economist in 贵础鲍鈥檚 .
鈥淭he consistent increase in the number of premium downturns in our monthly reporting strongly suggests that individual housing markets are at, or will soon be experiencing, their pricing peaks,鈥 he said. 鈥淲e are at the turning point. The likelihood of significant price increases in the near future grows smaller by the day.鈥
But the data also shows that prices are still up in most of the markets, Beracha said. He doesn鈥檛 expect home values to fall sharply across the board, as they did during the last housing downturn of 2006-2011.
鈥淭here simply is not enough inventory to go around,鈥 said Beracha, of FIU鈥檚 . 鈥淭hat undersupply will keep pressure on prices in many areas.鈥
The most recent figures reveal that Boise, Idaho, remains the nation鈥檚 most overvalued market, with buyers paying 66.73 percent above the long-term pricing trend. Austin, previously the second most overvalued market, has been surpassed by Las Vegas and Fort Myers. The Sunshine State also has two other metros, Lakeland and Tampa, in the top 10.
The full rankings with interactive graphics can be found .
The researchers study markets鈥 long-term pricing trends going back to 1996, and the data covers single-family homes, townhomes, condominiums and co-ops.
Johnson and Beracha believe the severity of the U.S. housing slowdown will vary across the nation.
Markets with continuing inventory shortages and spiking populations likely won鈥檛 face huge price declines. But that means affordability will be persistent in those areas, including metros in Florida, Georgia and North Carolina.
Markets with stagnant or declining populations and more homes for sale, such as metros in California, Oregon and Washington, could experience major price declines. But that also would make properties there more affordable for buyers currently priced out of the market.
鈥淲ill prices decline quickly and noticeably or will we see the nation鈥檚 inventory issues support prices at the expense of a prolonged period of housing unaffordability?鈥 Johnson said. 鈥淭his will all depend on population movements and how fast we build much-needed housing units.鈥
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