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by CareyBot

A study of the top 99 U.S. real estate markets announced today by the economics department of National City Corp. finds tiny housing bubbles – or "bubblettes" – in one-fifth of the U.S. housing stock. These bubblette areas are characterized by home-price overvaluation of 20 percent or more. The National City Corp. study attempts to answer the question: What should home prices be in each of the 99 largest metro areas after controlling for differences in population density, relative income levels, interest rates and historically observed premiums or discounts in those markets? The study compared these calculated norms to actual current prices. If actual home prices are much higher than historic prices when factoring in economic data, the survey considers those markets to be b...