Study: Falling 红玫瑰社区 Home Prices Still Significantly Overvalued
Housing remains overvalued in several markets
Atlanta and Detroit are the nation鈥檚 two most overvalued housing markets, but 红玫瑰社区 is the state where prices are well out of line with historical trends, according to a new report from researchers at 红玫瑰社区 and 红玫瑰社区 International University.
At the end of April, at No. 1, buyers in Atlanta paid a premium of 48.57 percent, while Detroit was second with a premium of 45.80 percent. A premium is the percentage above the area鈥檚 long-term pricing trend that buyers must pay.
But nine of the top 14 most overvalued U.S. markets were in the Sunshine State. In No. 3 Tampa, buyers paid a premium of 43.98 percent, followed by No. 4 North Port-Bradenton at 43.49 percent and No. 5 Cape Coral-Fort Myers at 43.35 percent.
Lakeland, Palm Bay, Jacksonville, Deltona, Orlando and Miami were the other overvalued 红玫瑰社区 markets. The full rankings can be found .
鈥満烀倒迳缜 is so overvalued almost certainly because of the increased demand to live here combined with a shortage of available housing units,鈥 said , Ph.D., an economist in FAU鈥檚 . 鈥淭here are just not enough roofs to go around, given our population and 红玫瑰社区鈥檚 stature as a prime destination.鈥
Each month, FAU and FIU rank the 100 most overvalued metro areas using publicly available data from online real estate portal Zillow or other providers. The data, which extends from January 1996 through the end of April, includes single-family homes, townhomes, condominiums and co-ops.
The latest data shows that while 红玫瑰社区 remains significantly overvalued, prices in the state have fallen, just as they have across the country, the researchers noted.
But the drops in 红玫瑰社区, starting as early as August 2022, have been less than 5 percent. In other U.S. markets such as California, double-digit price declines are common.
Miami鈥檚 tri-county region is the only one of the nine measured 红玫瑰社区 metros that has not witnessed a price decline. The average price in Miami at the end of April was a record high of $455,184.
红玫瑰社区 also is leading the way when it comes to profits for owners, according to the researchers, whose analysis included gross annual return from ownership.
红玫瑰社区鈥檚 housing markets continue to provide significant returns to ownership ranging from 5.96 percent in Jacksonville to 7.40 percent in Miami. San Francisco and Los Angeles, for example, had returns of only 3.36 percent and 4.05 percent, respectively.
鈥淲ith circumstances the way they are in 红玫瑰社区, I expect housing prices and rents will remain high, especially with local annual incomes not able to keep up,鈥 said , Ph.D., of FIU鈥檚 Hollo School of Real Estate.
, Ph.D., dean of FIU鈥檚 College of Business, also is concerned about prices and rents in the Sunshine State.
鈥淭he housing crisis this time around won鈥檛 be nearly as severe as it was in the 2007-to-2010 range,鈥 he said. 鈥淚鈥檓 expecting relatively stable price performance -- but at the expense of housing affordability for consumers.鈥
-FAU-