Yahoo Finance Study Exposes Top 100 Most Overpriced Housing Markets: Detroit, Atlanta, And Las Vegas Lead The List
Researchers Ken Johnson and Eli Beracha have developed a system to rank the top 100 most overpriced or underpriced metro areas in the U.S. using open-source data from Zillow and other providers to help people see the premium or discount they might be paying for their homes.
Their data shows that homebuyers in the Detroit metro area are paying a hefty premium for their homes, with prices soaring 40.79% above what they should be. At the end of May, the average home price in Detroit reached $254,325, but based on historical price growth data since 1996, that number should be closer to $180,642, according to these researchers.
Don’t Miss:
Can you guess how many Americans successfully retire with $1,000,000 saved? The percentage may shock you.
A groundbreaking energy company plugs into the $400 billion EV industry and is seeking investors.
Detroit isn’t alone in this trend. Atlanta ranks as the second most overvalued housing market, with homes selling for 40.37% more than their estimated value. The average price is $387,471 compared to the expected value of $276.033.
Other cities experiencing significant overvaluation include Las Vegas, NV (37.53%); Knoxville, TN (37.33%); Cape Coral, FL (36.11%); Tampa, FL (35.98%); Charlotte, NC (35.09%); Palm Bay, FL (34.94%); and Orlando, FL (34.29%). Lakeland, FL, rounds out the top 10, with homes overpriced by 34.06%.
At the bottom of the list are Urban Honolulu, HI and New Orleans, LA, with 3.75% and 6.05%, respectively, under the estimated home values.
According to Professor Johnson, even though downtown Detroit has seen a lot of improvements recently, the city and its surrounding areas are still facing significant problems like income inequality and slow population growth, as not many new people are moving to the area.
Trending: Miami is expected to take New York's place as the U.S. Financial Capital. Here's how you can invest in the city before that happens.
While many well-off individuals are currently buying homes at high prices in Detroit, there’s a fear that this trend might not be sustainable. The local economy and infrastructure may not be strong enough to support these inflated prices. If the market cools down or these buyers decide to sell, it could result in a significant drop in home values, affecting everyone in the area.
People considering buying homes in Detroit must be aware of this potential risk. While the current market might seem like a good investment, property values could decrease in the future if the area’s economic growth doesn’t catch up with rising home prices.
Another trend can also be clearly seen from this data. Florida has five locations in the top 10, including Cape Coral, Tampa, Palm Bay, Orlando, and Lakeland. The state has already seen its inventory levels surge, prompting sellers nationwide to aggressively cut prices. This is especially apparent in cities like Tampa, Cape Coral, Orlando, and Jacksonville, which are seeing an unprecedented number of sellers slashing their list prices to attract buyers.
Keep Reading:
The average American couple has saved this much money for retirement — How do you compare?
Warren Buffett once said, "If you don't find a way to make money while you sleep, you will work until you die." Here's how you can collect passive rental income without being a landlord.
"ACTIVE INVESTORS' SECRET WEAPON" Supercharge Your Stock Market Game with the #1 "news & everything else" trading tool: Benzinga Pro - Click here to start Your 14-Day Trial Now!
Get the latest stock analysis from Benzinga?
This article Study Exposes Top 100 Most Overpriced Housing Markets: Detroit, Atlanta, And Las Vegas Lead The List originally appeared on Benzinga.com
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
