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I have been hearing about California housing prices my whole life. Back in the 70s I even lived in southern CA and bought a house. It was a dump hardly bigger or better than a remodeled garage. A few years later we moved to Chicago and bought a McMansion for about the same money.
Think of it this way, houses in SF cost as much as 1bd apartments in Manhattan. That being said, houses out from the center I generally find cheaper than what I see in California.
Regardless, I love NYC and don't care. They're priced what the market deems is worth it. I can stay rent stabilized for my entire life and pay less than what most of these buyers are paying, investing the rest, and I'm perfectly content with that realization.
There may be slight ebbs and dips, but the overall housing market trend in the country is like this.
1) The major metropolitan along the coasts (along with a handful of others in the interior) largely dominate the market for high end jobs. These places are desirable places to live, largely due to the high skill, high wage employment base, and influx of educated, skilled immigrants. Many of these areas also have building impeded by restrictive building codes, NIMBYism, or natural barriers. Their long term trend is very positive. This includes the major West Coast metros.
2) The mid-major metropolitan areas in many landlocked states are going to take the lion's share of prosperity in those states. Think places like Nashville, TN and Indianapolis, IN. Nashville is taking the lion's share of new economic growth in TN. These markets are going to be long-term positive, but they often have more available land and a smaller population than coastal metros like NYC or SF. Larger states, like Texas, will often have more than one of these metros.
3) Regional "hub cities" that provide a jobs base and essential services to their immediate regions (think 100 miles or so). This often includes healthcare options not available elsewhere in the region, some corporate HQs, white collar office work, etc. Think Knoxville, TN or Greenville, SC. Their long term trend is mostly positive, but at a much slower rate than the metros falling into categories 1 and 2.
4) Small metros, small towns, and rural areas are mostly going to struggle. Their long term trend is flat to negative. Occasionally some small area will boom due to natural resources. Many of these communities are barely hanging on.
Just curious about the current state of the market. Are we thinking bubble or new normal?
The west coast, particularly California, has always been higher. I'm curious about our local Seattle market remaining this high or is it in a bubble. I think as long as the Seattle economy continues to offer high paying jobs, this will be the new normal here.
I don't think Portland is overpriced yet so I think their pricing is probably a new norm there.
The highest prices areas of Cali like the Bay area and Orange County I think are contingent on low interest rate so those areas I believe will pop if mortgage rates escalate rapidly.
Likely a new normal and any deflation of prices is likely to rebound quickly. Not sure I'd expect appreciation like recent times but demand is always going to be high, short of some major calamity.
Florida has more long term issues value wise. Once the boomers are done moving there they are going to have a major supply problem. Later parts of the boomers are much less well off as well.
I live on the west (gulf) coast of Florida. Housing prices have risen, but I attribute it to a long recovery.
Florida is just now getting back to pre bubble level pricing but cali is stratosphere pricing. In many markets $750k buys you a 3/2 1500 sqft turn of the century junker with a highway in the back. Property taxes are 3x Fl and likely you're paying an extra 10% in state/city income tax where Florida has none.
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