Metropolitan areas that have experienced heavy price declines are among the most popular among visitors to real estate search site Trulia, according to a new report launched by the company today. Trulia intends the report to be a forward-looking indicator of future housing demand.
Trulia’s Metro Movers Report is based on the ratio of inbound property searches from nonresidents of a metro compared to outbound searches from locals. The report examined searches on Trulia.com between July 1 and Sept. 30, 2011, in nearly 100 U.S. metro areas with at least 250,000 occupied housing units.
The report found that more than half of properties viewed on Trulia, 59 percent, were outside of a searcher’s current metro area, most often in a neighboring metro area. Slightly less than a quarter of searches, 23 percent, were for properties more than 500 miles away.
More than half (56 percent) of property searches outside a house hunter’s current metro area were in areas that have experienced larger price declines during the downturn, and 63 percent were for properties in lower-density metros, the report said.
"Despite having more employment opportunities, the higher cost of housing in big cities has made homes in nearby suburbs and neighboring smaller metros much more attractive to today’s homebuyers and renters," Trulia said.
All of the 10 most popular metros have experienced double-digit price declines from peak to trough, with seven out of 10 experiencing declines approaching 50 percent or more, according to figures from the Federal Housing Finance Agency cited by Trulia.
Half of the 10 metros are in Florida, two are in Southern California, and one is in Nevada — specifically the Las Vegas metro area.
Eight out of 10 metros had median list prices of less than $150,000 as of Nov. 15, with the exceptions of both California markets.
"Since the housing bubble burst, home prices in cities throughout Florida, Nevada and inland California have fallen by half or more. A glut of vacant homes — a result of overbuilding during the boom years and high foreclosure rates during the bust — has made homeownership very affordable in these areas, which has become more of a draw than a deterrent to prospective movers.
"We believe this future demand will lift some of the hardest-hit housing markets back toward growth," said Jed Kolko, Trulia’s chief economist, in a statement.
The North Port-Bradenton-Sarasota, Fla., metro area had the highest Metro Movers Index ratio among all metros, with six times more inbound searches than outbound searches.
The Riverside-San Bernardino-Ontario, Calif., area had about four times more inbound searches than outbound searches, while the other eight metros on the list had about two times more.
Methodology: Trulia defines a metropolitan area’s Metro Movers Index as the number of inbound property views by outsiders for each outbound property view by locals, based on almost 100 million monthly property views on Trulia.com, while adjusting for total views and site coverage.
Median list price is based on all active, nonforeclosure listings on Trulia as of Nov. 15, 2011. The price drop from peak to trough is sourced from the Federal Housing Finance Agency. It is the percentage change between the peak level during the boom and the lowest level since the boom, both of which vary by metro. –Source: Trulia.
North Port-Bradenton-Sarasota, Fla.
|Metro Movers Index (July-September 2011)||6.03|
|Median list price (as of Nov. 15, 2011)||$146,900|
|% chg. from peak to trough (FHFA)||-49%|