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The townhouse I recently sold in Atlanta doubled in value over the past 5 years. The northern burbs are no longer "cheap." The old 3,000 square foot house with a yard and fence that was $250,000 in 2010 is now $500,000+.
Still cheap compared to places like Seattle. 3000 sqft house in Seattle proper or Eastside suburbs are $1.5 million and up.
Interesting how SF, LA, Boston, DC and Seattle aren’t in the top 20 despite single family housing there going over a million. But places like Phoenix, Atlanta and Dallas known for cheaper housing are ranked higher for overpricing.
I’m not sure either. I would like to see their methodology. One big factor is average home value to average income. That would explain places like Boise and to a lesser extent Austin. But most of the expensive California metros are in the same boat yet they’re ranked as less overpriced, so they’re looking at other factors too. I’m just wondering what applies to Boise that makes it overpriced that doesn’t apply to say San Diego or LA.
The townhouse I recently sold in Atlanta doubled in value over the past 5 years. The northern burbs are no longer "cheap." The old 3,000 square foot house with a yard and fence that was $250,000 in 2010 is now $500,000+.
So many of my friends moved to Atlanta, bought homes in the 1990s and 2000s, and today are sitting on a lot of equity. Good for them, bad for homebuyers.
I’m not sure either. I would like to see their methodology. One big factor is average home value to average income. That would explain places like Boise and to a lesser extent Austin. But most of the expensive California metros are in the same boat yet they’re ranked as less overpriced, so they’re looking at other factors too. I’m just wondering what applies to Boise that makes it overpriced that doesn’t apply to say San Diego or LA.
Methodology is here. btownboss is right, it's just how much home prices have increased in the past few years compared to how much they would've been expected to increase based on historical trends.
The mountain west metros like Boise have seen greater housing appreciation more recently compared to the west coast metros simply because the west coast metros became large population centers first, then got expensive, and now people getting priced out of them are flocking to the inland metros. So, interesting, but the title is a misnomer.
The way I'd calculate "over/underpriced" would be to find a "Desirability Index" for each metro (maybe based on surveys of where people would want to live if cost were no object, or just adding up the metros' scores on commonly desired traits like warm weather, good economy, low crime) --- and then compare that index to their actual housing costs. This would show you which expensive metros are genuinely desirable, and which just have their COL driven up by artificial factors like hype, migration from even more expensive places (e.g. Bay Area refugees in Reno), or being surrounded by water/mountains which constrains development.
…NYC & Baltimore are literally the only 2 major cities considered “underpriced”
Interesting
That's a large part of what makes this list suspect. You'd expect that half of the metros would be overpriced and half underpriced. That's how median works. But this list has nearly everywhere overpriced.
That's a large part of what makes this list suspect. You'd expect that half of the metros would be overpriced and half underpriced. That's how median works. But this list has nearly everywhere overpriced.
Rural areas and smaller metros are underpriced I'm guessing
The townhouse I recently sold in Atlanta doubled in value over the past 5 years. The northern burbs are no longer "cheap." The old 3,000 square foot house with a yard and fence that was $250,000 in 2010 is now $500,000+.
That is dirt cheap on the coasts. And Austin apparently.
That is dirt cheap on the coasts. And Austin apparently.
Yeah… my mom’s place in Valparaiso, Indiana recently appraised for $550k. She bought in 2006 at 269k. Granted, it’s on 6 acres and in town. She’s got developers left and right trying to get her to sell so they can subdivide and get 10+ SFHs. I keep telling her she should, this bubble market won’t last forever.
Cheap is relative. A friend sold a home in Dallas recently that appreciated over $105k in 20 months. As much as he liked where he lived, the chance to get from under the HOA he was paying and cash out was too tempting to not take.
I havr a feeling a lot of housing markets that randomly increased out of nowhere like Boise and Billings and Spokane will return to their precovid levels.
Assuming there are no drastic changes in weather/water availability, I would not bet on it.
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