WALTHAM, Mass., April 27, 2016 /PRNewswire/ -- This month, Pro Teck Valuation Services' Home Value Forecast examines the impact surging home prices in major metros can have on outlier communities—particularly in the San Francisco Bay Area where places like Antioch continue to struggle as a result of the growing economic displacement.
Economic displacement in the Bay Area is in large part due to job growth, but also equally as a result of the housing market both in and around San Francisco. Over the last five years alone, more than 500,000 jobs were created in San Francisco with limited additions to the housing supply.
Because of the natural laws of supply and demand, housing prices in San Francisco have sky rocketed, pushing many people farther out to find a home. The average home in the metro is $1.2 million, and the prices are forecasted to rise, making the San Francisco real estate market out of reach for many.
"This isn't a new problem for San Francisco, just one that has been exacerbated by the real estate crash," said Tom O'Grady, CEO of Pro Teck Valuation Services. "New housing starts tanked for three and a half years after 2008, leaving much room to make up."
So with the average home costing over one million dollars, working-class people who work in San Francisco are moving farther out to find reasonable priced home. Home Value Forecast looked at Antioch, CA – a community 40 miles east of San Francisco.
Antioch — A Story of Slow Recovery
Antioch's real estate market has yet to recover from the housing crisis. This struggle, according to O'Grady, has much to do with how things were prior to the crash.
"Pre the 2008 housing crisis, Antioch's real estate market was fueled by the high availability of non-traditional home loan products," said O'Grady. "Zero-down or low down-payment mortgages were very popular before the housing crisis in Antioch, with loan-to-value averages hitting 97% by Q4 2006."
"Antioch's is a community still in transition," said O'Grady. "After the foreclosure crisis many homes in the community were bought and rented out as investment properties, leading to more temporary residents. Today, the number of REO sales has returned to pre-crash levels and prices have begun to rebound. As more families make permanent homes in Antioch, home prices should continue to rise."
Each month, Home Value Forecast uses a number of leading real estate market-based indicators to rank the single-family home markets in the top 200 CBSAs and highlight the strongest and weakest metros.
Top 10 CBSAs this month include:
Yuba City, CA
Boise City, ID
Salt Lake City, UT
San Antonio-New Braunfels, TX
San Diego-Carlsbad, CA
Top ten this month includes the San Antonio-New Braunfels, TX CBSA. New Braunfels lies on Interstate 35 between Austin and San Antonio, and has been experiencing tremendous growth as the two anchor cities have been attracting new businesses.
The Austin-San Antonio area population is expected to increase more than 34% by 2030, to 5.71 million residents. With growth four times the Texas average, housing prices should continue to increase.
Bottom 10 CBSAs this month include:
El Paso, TX
Atlantic City-Hammonton, NJ
On the other end of the Texas economy, the real estate market in Midland continues to worsen. A 101% increase in active listings, 140% increase in Months of Remaining Inventory (MRI) and 198% increase in Foreclosure as a % of Sales are numbers not seen at Home Value Forecast in a while. The speed of the change in the market is reminiscent of 2008, but on a localized level. The Midland real estate market will continue to be on shaky ground until oil prices rebound.
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.
Reporters interested in national, regional or metro level housing data tailored to meet story needs, please email your inquiry to [email protected].