Forbes Where Home Prices Are Likely To Rise
August 26, 2008
Forbes.com just released the top 10 cities which homeowners can expect long-term appreciation. Two Texas cities, San Antonio and Austin made the list.
To determine where house prices are expected to rise next, Forbes.com looked at projections for housing starts from the NAHB and job-growth figures from Moody’s Economy.com, for the 100 largest metro areas in the U.S. The estimates are based on the cost structures of business in the respective cities and the composition of the local economies.
10. Oklahoma City
9. Atlanta, Ga.
8. Minneapolis, Minn.
7. Colorado Springs, Colo.
6. Salt Lake City, Utah
5. Austin, Texas
4. Portland, Ore.
3. San Antonio, Texas
2. Charlotte, N.C.
1. Albuquerque, N.M.
Texas On The Rise?
Centex one of Texas’ largest homebuilders, has been stung by over extension into Michigan and Colorado, as well as big bets on the vacation-home market in Texas. In July, the builder reported losses of $150 million. There’s a bright spot, however.
San Antonio and Austin, Texas, have largely avoided the real estate crash, with price increases of 2.5% and 4.1% in year-over-year terms, respectively, according to the NAR. This is driven in part by the fact that the two markets are expecting building slowdowns of 24.7% and 28.2%, respectively, through the end of the year, as home builders are bearish about the remainder of 2008 and 2009 in the sales market or cannot find financing. Builders as a whole are taping their wounds and cutting back production, adopting a wait-and-see approach to home prices in the coming year.
But for the start of 2010 and into 2011, builders expect a more vibrant market for sellers. For homes built in 2009, which would come off the conveyor belt in 2010 and 2011, the NAHB forecasts a 9.6% increase in Austin and a 20.9% increase in San Antonio above 2008 levels. Much of that has to do with expected job growth in all non-farm sectors.
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