Why do I have deja-vu to the famous March 2000 Barron's cover story on dot-com cash burn? People won't be able to say they weren't warned. Especially folks in Naples, Florida.
Mortgage rates up...affordability down
Interest rates are the highest in years, helping to make housing markets even more overvalued.
"I think it's indisputable that demand in the housing market has declined in the past few months," says Richard DeKayser, chief economist for National City Corp., an Ohio-based mortgage banker. "It's very clear that rising interest rates figure very large in that decline."
See rankings for 299 markets. Here's top 10 overvalued markets:
Naples
FL
$367,100
96.30%
Merced
CA
$287,000
86.20%
Salinas
CA
$611,200
83.80%
Stockton
CA
$339,800
79.50%
Madera
CA
$290,100
77.00%
Santa Barbara
CA
$638,000
76.70%
Port St. Lucie-Fort Pierce
FL
$233,900
75.00%
Riverside-San Bernardino
CA
$320,600
72.90%
Modesto
CA
$317,500
72.30%
Medford
OR
$268,400
69.70%
March 13, 2006
299 Housing Markets Ranked - How Overvalued is Yours?
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22 comments:
Keith, your favorite PHX is overvalued on 40%. If prices swing down, you'll buy you house back.
But, they're not going swing down - "inflate or die" principle stays strong.
My town is overvalued 47.7%. It's a beach town. There has been a heavy speculator presence here, but now more than 7200 properties are for sale with about 100 more coming onto the market weekly. 5,000 preconstruction condo buyers have bailed out in the past few months, and there are about 50 condo projects either under construction or in development. About 60% of recent mortgages here are interest only.
On the plus side, this is a really beautiful place and still a bargain compared to south Florida.
So I'm asking the experts: what kind of drop should I expect here?
My town is overvalued 60%! I was trying to guess the number myself by throwing darts at a page of random numbers taped to my RENTED condo wall. But I'm a lousy shot and the dart went out the window and hit two of the realtors who are camped out at the condo open house next door, injuring one of them right in his exposed asset bubble.
Yippeee!! I made the top 10. My town is 72% overvalued. Explains why my neighbor dropped her selling price by around 60k!! And all the Open House signs and a couple for lease signs. Have any of you noticed more open houses or is it just me?
Warning: Ramble below.
I made a post about this earlier. According to the overvalue, my old house should be worth $223K which seems right to me. I sold at $560K; at times, I felt like I was having a heart attack.
I got my house into escrow in 10 days, but it felt like a very long time. A stock transaction takes less than 10 seconds on a market sell/buy (instant gratification for me). You really get a feeling that your house is illiquid after just a few days. Then there is the 30 day escrow period where I had a nightmare each night thinking that the buyers were going to bail.
So far I've been right about getting out at the peak for this housing cycle. I never doubted or feared this exit strategy. I only feared being stuck.
So as listing have sticky prices, the sellers are just sticking themselves.
Whose got the best housing bubble blog?
HP or Housing Bubble 2?
I have been leaning toward HP, for snappy graphics, frequent updates, and sheer exuberant outrageousness. But you have to like what HB2 is doing in putting the media's feet to the fire.
Good stuff from both.
Housing Bubble 2 is too heavy in content, and takes itself too seriously, but it generates healthy and consistent debate (think The Economist).
HP has better graphics and lighthearted quips, but oftentimes chooses fluff instead of substance (think USA Today).
Both do a fine job of infoming readers - a perfect housing bubble blog would contain the content of HB 2 and the pictures of HP.
did NAR chief Mr. Lereah said there`s no Over-valution/Over Pricing of Homes on his appearance at CNBC TV yesterday ???
rotflmao !!!
Keith, surely you dont buy into that very simple analysis of those housing markets, especially the Naples market. Have you ever been to Naples Fla? I have been going there since the late 70's when i was 6 yrs old. I just visited it last week. You know all those investment bankers and traders that just got paid those 7 digit bonus checks? Yeah, those guys own stuff in Naples. So to compare the prices in a town as a ratio to it's resident's (many are retired) income is foolish, and incomplete. There is NO shortage of $ in Naples. It is the Palm Beach of the west coast of Fla, and is very similar in feel to Greenwich CT (I bet you feel even that town is overvalued). I do not argue that RE prices are steep, and that the up move is well played out, but that anaylsis was stupid, especially for resort towns like Naples. Hopw about Nantucket, another favorite of mine. You cannot touch anything for less than $800k, and you would not be "happy" with someting until you paid at least $1.25M. Thing is...it is Nantucket: a 14 mile long, 3 mile wide, playground for the ultra rich during a 10 week season. Oh, and it has tons of history going back to the 1600's. Look at the ratio of median prices to incomes there; makes Naples look like Omaha I bet.
Have real estate agents replaced used car salesman as the lowest scum on the earth?
The rich Bit..es in Naples think they are imune to losing money. This could be their big wake up call.
The rich bit..es in Naple dont care about watching their houses value. They are large and liquid...these are toys. 84 degrees, dry, sunny in winter is a winner. In the summer, head up to pad in NYC and weeks in Nantucket, while you watch your $20M+ liquid net worth grow. This is Naples.
Keith's intelligence is 96% overvalued.
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