Austin Catching Up to Boise as Most Overvalued Home Market
Pittsburgh pricing may have peaked; Baltimore comes in as the best bargain.
Home prices in May rose in 99 out of 100 markets that Florida Atlantic University and Florida International University track. Only the most overvalued market (Boise) saw a decline.
Austin is on Boise’s heels, though. Boise was overvalued by 70.76 percent in May based on the influx of remote workers seeking remote locations. Austin is next, where buyers paid 67.97 percent more than they should, based on the market’s history of prices.
“At this rate, it won’t be long before Austin overtakes Boise as the most overvalued market in the country,” Eli Beracha, Ph.D., of FIU’s Hollo School of Real Estate, said in a prepared statement. “Austin has a lot going for it, including weather, culture and the economy, so it’s naturally attracting more residents who are driving up home prices there.”
Pittsburgh is another market that might have peaked, according to the study.
“The evidence continues to suggest that we are nearing the peak of the current housing cycle,” Johnson said. “People buying homes now in the most overvalued markets should be prepared to stay there for at least several years to ride out what could be a bumpy stretch for prices.”
Following Baltimore on the “bargain” list were Honolulu (3.46 percent), Washington, D.C. (4.32 percent) and New York (4.50 percent).
The study said anecdotal signs of a U.S. housing slowdown due to rising mortgage rates had not yet translated into lower home prices, however it’s now July and rates have only gone up since May.