Pittsburgh per capita income in top 10 after adjustments

[BrianTH]

Originally Posted by Katiana

Of course Pittsburgh's foreclosure rate should be lower than a lot of cities'. It has one of the cheapest housing markets in the country.

Indeed, at least if you are talking about larger metros (many of the smaller metros on this list would have housing prices as low or lower). Plus it is doing relatively well as far as unemployment rates and wages are concerned. All that adds up to a fairly obvious explanation for why the foreclosure rate has remained relatively low.

Of course I think that was the original point--Pittsburgh housing prices never really got out of whack from incomes.

[Fiddlehead]

Originally Posted by BrianTH

Indeed, at least if you are talking about larger metros (many of the smaller metros on this list would have housing prices as low or lower). Plus it is doing relatively well as far as unemployment rates and wages are concerned. All that adds up to a fairly obvious explanation for why the foreclosure rate has remained relatively low.

Of course I think that was the original point--Pittsburgh housing prices never really got out of whack from incomes.

I think the important thing is that prices to incomes (and job availability) have held steady. I think the fact that folks on the coasts laugh at 2.6 price to income ratios is exactly the problem. The most bubblicious places (CA, AZ, FL, OR, NV) have been immigration magnets and have each developed a mythology that they are somehow unique. Many of those places were so out of touch with the real value of real estate that something had to give. Be thankful that such real estate hype has not hit your city. It is very destructive, and there are many who profit from supporting a corrupt system once it gets going, and many others who are ruined or end up paying the bill.

[Hopes]

Originally Posted by Fiddlehead

Be thankful that such real estate hype has not hit your city. It is very destructive, and there are many who profit from supporting a corrupt system once it gets going, and many others who are ruined or end up paying the bill.

I'm concerned that will happen to Pittsburgh in the near future. Not only did our real estate remain stable, but our economy remained stable too. Since we're one of the only areas of the country doing fairly well during this recession, many people are looking to move here. I just pray that our real estate values remain stable and construction increases instead of values rising.

[dugdogmaster]

Originally Posted by Hopes

I just pray that our real estate values remain stable and construction increases instead of values rising.

People always take the quick and easy route. Which do you think that is?

[Fiddlehead]

It would seem that there is some room for growth within the existing capacity, with the population declines and all. Do you see a need for a bunch of new construction? Seems like that would just add sprawl.

I don't see Pittsburgh becoming a huge destination city like Portland right away. And the people who would come in probably were not the super bubblers that flew out of the sunbelt. Probably just working stiffs looking for a decent place to start. But if good price growth does run for a couple years or so, and it appears there is a lot of profit to be made, the "infestors" will move in to bid things up. That is where good regulation, loan standards can come in, to make sure the speculators can actually service their debt. In 2005,anyone who could fog a mirror could get a loan in California.

[BrianTH]

I'm reasonably confident we have enough excess capacity to keep a pricing boom in residential real estate from taking off for quite a while, even if net migration turns solidly positive. And we also have plenty of room for infill.

That said, it is true that real estate booms can feed on themselves, so we should be keeping an eye out. And I'm actually much more worried about a boom-and-bust cycle in commercial real estate than residential real estate--there is much less excess capacity on the commercial side in Pittsburgh, and so many other markets have so much excess capacity that if and when money starts looking for commercial real estate projects to fund again, I could see Pittsburgh taking off.

[Fiddlehead]

Originally Posted by BrianTH

That said, it is true that real estate booms can feed on themselves, so we should be keeping an eye out. And I'm actually much more worried about a boom-and-bust cycle in commercial real estate than residential real estate--there is much less excess capacity on the commercial side in Pittsburgh, and so many other markets have so much excess capacity that if and when money starts looking for commercial real estate projects to fund again, I could see Pittsburgh taking off.

Yes, this is precisely the problem. A positive feedback loop sets up if things take off and investors rush for a slice of the take. It is just something that we cannot let happen again. RE is just too big for daytrading. Folks making hundreds of thousands in ill-gotten gains flipping properties. Of course anyone who loses a fraction of that folds the cards, and torpedoes the bank. And we all have to step in. It still galls me to bail out the *****W!PE$ who did this to the country.