Forbes America’s 25 Strongest Housing Markets
January 8, 2009
Behind the Numbers
To compile this list, we asked Moody’s Economy.com to compile a list of the country’s real estate markets that are nearest to recovery. Moody’s looked at the country’s Census-defined metro areas–including metropolitan and micropolitan statistical areas–with populations over 500,000, and prepared forecasts through 2011. They then compared them to prices in the second quarter of 2008, which are the latest figures available, to calculate how far prices will likely fall before reaching bottom.
Not one metro area will see prices increase before the end of this year, according to Zandi’s forecasts. The strongest metro areas will be flat at best–but that’s better than the 15% drop Moody’s expects on average in the U.S. Prices won’t start to pick up again until late this year or sometime next year even in the strongest markets.
That’s because there are countervailing forces at work. The job market is weakening all over. On the other hand, new housing starts are down, which should help reduce supply–eventually. And, at just over 5% for a conforming 30-year mortgage, interest rates are lower than they’ve been in more than 35 years.
Texas markets are most set to benefit. Housing values were rising in many Lone Star State towns until oil futures collapsed and agricultural commodity prices fell. But the bottom doesn’t look very deep. Moody’s forecasts no change for McAllen and a fall of less than 3% for Dallas, Fort Worth, El Paso, San Antonio and Houston.
“Texas has the best large-state economy in the country right now,” says Zandi. “Employment is slowing, but its still growing.”
McAllen, Texas
Syracuse, N.Y.
Pittsburgh, Pa.
Buffalo, N.Y.
El Paso, Texas
Tulsa, Okla.
Houston, Texas
Charleston, S.C.
Little Rock, Ark.
Birmingham, Ala.
Fort Worth, Texas
New Orleans, La.
Dallas, Texas
Austin, Texas
Rochester, N.Y.
San Antonio, Texas
Augusta, Ga.
Baton Rouge, La.
Memphis, Tenn.
Oklahoma City, Okla.
Albany, N.Y.
Indianapolis, Ind.
Columbia, S.C.
Scranton, Pa.
Omaha, Neb.
Read the entire article “America’s 25 Strongest Housing Markets” written by Deborah Orr, at Forbes.com
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