Where politics is personal not partisan

U.S. Home Prices Near 10-Year Peak But Don’t Signal Housing Bubble

Housing Prices
U.S. Home Prices Near 10-Year Peak But Don't Signal Housing Bubble

Latest index by Nationwide finds ‘healthy’ fundamentals in most local housing markets without flashing alarm signals

COLUMBUS, Ohio, Sept. 19, 2016 /PRNewswire/ — House prices nationally have risen significantly since the mortgage crisis, but “healthy fundamentals” in the majority of local housing markets signify that another housing bubble isn’t imminent, according to a forward-looking housing barometer released today by Nationwide.

Today’s housing market remains positive and in stark contrast to the conditions during the housing bubble when more than three-fourths of metro areas flashed warning signs at least two years before the bubble popped, according to Nationwide’s Health of Housing Markets Report (HoHM Report). The latest HoHM Report finds that continued job growth, increasing incomes and record low mortgage rates across the U.S. are keeping housing affordable. Additionally, modestly tight mortgage underwriting criteria and a decided lack of overbuilding should support housing markets in the year ahead. The report also shows that there are a handful of regional markets where house prices are more than 20 percent above their pre-crash peaks.

“Home prices reaching or even passing their pre-crash highs of a decade ago does not signal a bubble in the near future,” said David Berson, Nationwide senior vice president and chief economist. “Even with record-high prices in some markets, housing remains relatively affordable, and we are not concerned about a national bubble.”

Berson noted that only 7.1 percent of homeowners remain underwater on their mortgages and housing market metrics across the board remain healthy. “We’re optimistic that the housing market will continue to boost the U.S. economy,” he said.

The quarterly report evaluates the housing health for the U.S. and 400 metropolitan statistical areas. Overall, it indicates that the vast majority of local housing markets will experience sustainable housing activity during the next year with little chance of substantial downturns.

READ
Americans' Knowledge of the Branches of Government Is Declining

Incomes in six markets across the country, however, are not keeping pace with sharply rising home prices. They are Dallas, Houston and Austin, Texas; Denver, Colo.; and San Francisco and San Jose, Calif. Meanwhile, home prices in several metro areas that experienced the biggest increases in the housing boom remain more than 20 percent below their peak. They include Bakersfield and Fresno, Calif.; Las Vegas, Nev.; Orlando, Fla.; and Tucson and Phoenix, Ariz.

The report also found that:

  • While more than half of metro areas are still below their peak home prices of a decade ago, about 150 areas set all-time price peaks already in 2016. Housing trends driving the overall market suggest that national home prices should surpass their previous peak in coming years.
  • The energy sector slowdown weighs heavily on job growth and housing sustainability in Louisiana, North Dakota, Texas and Wyoming, placing metro areas in those states among the bottom 10 states on the index for the second consecutive quarter. Many of them have been at the bottom for the past year.
  • Major MSAs among the top 50 include Baltimore, Cincinnati, Detroit and Jacksonville; meanwhile, three of the 40 largest MSAs remain concerning, just outside of the bottom 10: Houston, Seattle, and New Orleans.

The 10 top metro areas in the index, which reflects the health of housing, are, in order, FayettevilleSpringdale, Ark.-Mo.; Saginaw, Mich.; Valdosta, Ga.; Cumberland, Md.-W.Va.; Jackson, Tenn.; New Bern, N.C.; BuffaloNiagara Falls, N.Y.; NilesBenton Harbor, Mich.; DurhamChapel Hill, N.C.; and Manhattan, Kan.

Five of the bottom 10 metro areas are in Texas. In order, they are Bismarck, N.D.; Midland, Texas; Casper, Wyo.; HoumaThibodaux, La.; Lafayette, La.; College StationBryan, Texas; Odessa, Texas; DallasPlanoIrving, Texas; Hammond, La. and Victoria, Texas.

Showing the most improvement in the past year, in order, are New Bern, N.C.; Saginaw, Mich.; Valdosta, Ga.; Goldsboro, N.C.; WatertownFort Drum; N.Y.; Beckley, W.Va.; Las Cruces, N.M.; Dutchess County, N.Y.; Charleston, W.Va. and Jackson, Tenn.

Weakening the most in the past year, in order, are Bismarck, N.D.; Owensboro, Ky.; Midland, Texas; Auburn-Opelika, Alaska; Anchorage, Alaska; Casper, Wyo.; Peoria, Ill.; College StationBryan, Texas; Tulsa, Okla. and Wenatchee, Wash.

More information about the HoHM Report, including the methodology used, can be found at www.inthenation.com/housing. The HoHM Report is released on a quarterly basis online and in print.

READ
Election Analysis Isn't Just About the Polls

About Nationwide

Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the U.S. and is rated A+ by both A.M. Best and Standard & Poor’s. The company provides a full range of insurance and financial services, including auto, commercial, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; banking and mortgages; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com.

Nationwide, Nationwide is on your side and the Nationwide N and Eagle are service marks of Nationwide Mutual Insurance Company.

NFN-0847AO

Contact:
Jeff Whetzel
(614) 249-6354
whetzej@nationwide.com

Haley Fry
(312) 552-1133
Haley.Fry@edelman.com

SOURCE Nationwide

image_pdf

Last updated by .

PR Newswire
About PR Newswire 54 Articles
PR Newswire, a Cision company, is the premier provider of multimedia platforms and distribution that marketers, public affairs and investor relations officers leverage to engage key audiences.

Be the first to comment

Leave a Reply

Newsletter Sign Up
Subscribe to our email newsletter today to get the latest commentary, news and special offers from Practical Politicking
No Thanks
Please check your inbox now to confirm your subscription. Make sure your spam filter does not block our emails.
We respect your privacy. Your information is safe and will never be shared.
Don't miss out. Sign up today.
×
×
Newsletter Sign Up
Subscribe to our email newsletter today to get the latest commentary, news and special offers
No Thanks
Please check your inbox now to confirm your subscription. Make sure your spam filter does not block our emails.
We respect your privacy. Your information is safe and will never be shared.
Don't miss out. Subscribe today.
×
×
A Moment of Your Time, Please
We're glad you visited our site today and we hope you found something of value, but changing our broken political system takes more than just an online visit, here or elsewhere.
Our core mission is to provide quality, thought provoking content, and to provide a place for those who have become disillusioned with social media as a political discussion platform to again get engaged.

Please take just a minute, click on LEARN MORE, and consider what we have to offer.
No Thanks
Thanks for your time. We greatly appreciate your learning more about Practical Politicking.
Don't miss out. Subscribe today.
×
×