Wednesday, October 21, 2009

Healthiest housing markets

Posted on Cyberhomes by Lauren Baier Kim:

The fall update on the 20 healthiest housing markets from BUILDER and Hanley Wood Market Intelligence is out. Cruising through the list is a very interesting exercise. Nearly all the markets on the list have at least one of three factors shoring up demand – a major university, a military base or a position as a capital city.

Five of the 20 – and three of the top five – are in Texas, including the top spot, which goes to Austin, Texas. That’s not surprising. I’ve always heard very good things about this town. It winds up on a lot of top 10 lists, touted for its culture (it is home of the South by Southwest Festivals), its commitment to green building, the University of Texas, and its general cool factor. It’s not surprising, either, that Washington, D.C., is number three on the list, given all the job growth in the nation’s capital.

The bulk of the rest are smack in the middle of the country’s heartland, cities such as Oklahoma City, Okla.; Tulsa, Okla.; Des Moines, Iowa; Little Rock, Ark.; Omaha, Neb; and Madison, Wis. There also are two markets in Utah, one in Colorado, and one in Washington State.

Only three of the top 20 – Baton Rouge, La.; Charleston, S.C.; and Raleigh, N.C. -- are in traditionally Southern markets. Markets that drove the housing boom – such as Southern California, Arizona's Phoenix and Tucson, Nevada's Las Vegas, Georgia's Atlanta and Florida markets Orlando, Miami, Tampa, and Ft. Myers – are nowhere to be found.

The other interesting thing is how dramatically the list has changed since it originally debuted in February. The first list included Indianapolis, Ind; Myrtle Beach, S.C.; Nashville, Tenn; Wilmington, N.C.; Seattle; and Charlotte, N.C. They’re gone now.

If you look at the list and are scratching your head about a particular city’s inclusion, here is some context. You’ll notice it says the "healthiest" markets, not "healthy" markets. There’s a big difference. The scoring system incorporates home price appreciation, job growth, household growth, unemployment and median income growth. A score of 50 or more is considered healthy. Only one city of the 20, Austin, actually scored above 50.

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