WALTHAM, Mass., Nov. 23, 2015 /PRNewswire/ -- Pro Teck Valuation Services' Home Value Forecast (HVF) November update revealed that all of the top ten real estate markets are located out west.
With five from California, four from Washington state and one from Idaho, this months top ten is once again dominated by west coast CBSAs. But, while the trend appears promising, it has some concerned that these markets may be overheated.
In evaluating the top ten CBSAs HVF found the following:
- 4 out of the 10 CBSAs — Bellingham, Portland, San Jose and Seattle—are now at all-time highs
- 2 out of the 10 CBSAs— Boise and Mount Vernon—are forecasted to hit new highs by Q1, 2017
- 4 out of the 10 CBSAs— Modesto, Stockton, Sacramento, Vallajo—are not forecasted to exceed pre-crash highs in the next five years
A closer look at the top ten CBSAs shows that Affordability for all are at or above historic norms.
"The first question people ask is whether there is a bubble on the horizon for any of these communities," said Tom O'Grady, CEO of Pro Teck Valuation Services. "While there are many factors that can impact a "bubble" one of the most important factors at Home Value Forecast is looking at home affordability via an affordability index."
Affordability is derived by looking at the median income for a particular area as a ratio to the mortgage payment needed to purchase a median priced home. An index score above 100 signifies that a household earning the median income has more than enough income to afford the mortgage. Lower scores suggest more income is needed to cover mortgage expenses.
When looking at affordability indexes for San Jose and Stockton, two of the top ten communities, it can be seen that San Jose has returned to its historic 70 average, showing that income has increased to meet historic norms for the area. While Stockton, historically a more affordable place to live, has seen its affordability return to the 120s.
"San Jose and Stockton are examples of what we see for all of our top ten CBSAs – while home prices are increasing, affordability is at or above historic norms and nowhere near "bubble" territory of 2004-2007," added O'Grady
This month's Home Value Forecast update also includes a listing of the 10 best and 10 worst performing metros as ranked by its market condition ranking model. The rankings are run for the single-family home markets in the top 200 CBSAs on a monthly basis. They highlight the best and worst metros with regard to a number of leading real estate market indicators including: sales/listing activity and prices, months of remaining inventory (MRI), days on market (DOM), sold-to-list price ratio, foreclosure percentage and REO activity.
October's top 10 CBSAs include:
- Bellingham, WA
- Boise City, ID
- Modesto, CA
- Mount Vernon-Anacortes, WA
- Portland-Vancouver-Hillsboro, OR-WA
- Sacramento-Roseville-Arden-Arcade, CA
- San Jose-Sunnyvale-Santa Clara, CA
- Seattle-Bellevue-Everett, WA
- Stockton-Lodi, CA
- Vallejo-Fairfield, CA
October's bottom 10 CBSAs include:
- Huntington-Ashland, WV-KY-OH
- Joplin, MO
- Lake County-Kenosha County, IL-WI
- McAllen-Edinburg-Mission, TX
- Tallahassee, FL
- York-Hanover, PA
- Atlantic City-Hammonton, NJ
- Detroit-Dearborn-Livonia, MI
- Gary, IN
- Jacksonville, NC
To learn more about the trends found in month's HVF, as well as get all of the updated information on the top ten best and worst performing metros, check out the entire update here.
About Home Value Forecast
Home Value Forecast (HVF) is brought to you by Pro Teck Valuation Services. HVF provides insight into the current and future state of the U.S. housing market, and delivers 14 market snapshot graphs from the top 30 CBSAs.
HVF is built using numerous housing and economic data sources. The top 750 CBSAs as well as data, down to the ZIP code level for approximately 18,000 ZIPs, are available with a corporate subscription to the service. To learn more about Home Value Forecast and Pro Teck's full suite of residential real estate valuation products, visit www.proteckservices.com. You can also find Pro Teck on Twitter at @ProTeckServices.
About Pro Teck Valuation Services
Pro Teck Valuation Services is a national provider of residential real estate valuations. For more than 30 years, we have worked with lenders, loan servicers and investors to improve risk management through superior real estate collateral information. Pro Teck offers a comprehensive suite of services including real estate data and analytics, field valuations, review/due diligence and appraisals. Please visit us at www.proteckservices.com.
SOURCE Pro Teck Valuation Services