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SUMMARY: 10 Real Estate Markets to Watch in 2011

An Inman News Special Report

By Andrea V. Brambila, Friday, March 11, 2011.

Inman News®

Flickr image courtesy of <a href="http://www.flickr.com/photos/jontintinjordan/3736098889/sizes/o/in/photostream/" target=blank>jontintinjordan</a>.Flickr image courtesy of jontintinjordan.

Inman News examined housing, economic and demographic data for metropolitan areas nationwide in compiling a list of 10 housing markets that are showing signs of strength and may outperform other housing markets in 2011 in several key metrics. Inman News also asked a host of real estate search and data companies to share research and methodology to identify high-performing real estate markets across the U.S.

Real estate markets in the Midwest and Northeast dominated a list of 10 fast-rising real estate markets nationwide identified in the Inman News analysis, as many markets in the Sun Belt states are still struggling through the housing downturn.

The Midwest and Northeast U.S. accounted for eight of 10 markets on the list: Bismarck and Fargo, N.D.; Des Moines, Iowa; Bloomington-Normal, Ill.; Elmira and Buffalo-Niagara Falls, N.Y.; Portland-South Portland-Biddeford, Maine; and Burlington-South Burlington, Vt.

The other two markets on the list: Kennewick-Richland-Pasco, Wash.; and the Washington, D.C., metro area.

   

See the 10 markets
   

Nationwide, unemployment is high, home prices are flat and trending lower since the expiration of the federal homebuyer tax credits, and overall sales fell last year compared to the prior year.

Stan Humphries, chief economist for Zillow, said it's unlikely that "substantial price appreciation" will occur "in any market nationwide in the near term." Rather, the company identified some "stabilizing" markets in a chart provided for this report.

"Nationally, I don't think we'll see a bottom in home prices until later this year and once they hit bottom we're looking at a prolonged period of time where housing appreciation is below historical norms," Humphries said.

Nevertheless, Inman News identified some markets with significant price appreciation as well as a vibrant job market, a high level of home affordability, low foreclosure activity, and other indicators for a healthy housing market. Most have populations below 250,000. In addition, jobs in the health care industry and public sector, especially, buoyed employment in these areas. 

To compile the list, Inman News considered markets with low unemployment rates, high median sales price growth, growth in the number of building permits issued, a rise in in-migration from other states, population growth, projected job growth, affordability, low foreclosure activity, median household income growth, fewer average days on market for for-sale properties, and growth in occupied housing units.

Among the findings in this report:

  • Of the states represented in this list of market areas, North Dakota, Vermont, Iowa and, to a certain extent, New York, also shed fewer Realtors during the housing bust compared to other states.
  • Two of the 10 markets on this list are state capitals and one is the nation's capital -- agents say government centers can lend job stability.
  • Six of 10 markets had median sales prices below the national median in the fourth quarter of 2010, and seven out of 10 had median prices lower than the national median price for the full year in 2010.
  • Where affordability rankings were available, the markets on the list had no less than 75 percent of homes affordable to those households earning the area's median income.
  • All had unemployment and foreclosure rates lower than the national average. None of the markets had unemployment rates higher than 8.2 percent.
  • Only two of the markets had populations above 1 million. Six of 10 had populations below 250,000.
  • Companies in the health care and medical industries were major employers in at least seven of the 10 markets.
  • Seven out of 10 markets had some military presence. The Fargo, Burlington, Portland and Des Moines metro areas are each home to an Air National Guard base. The North Dakota National Guard Headquarters are in Bismarck. There's an Air Reserve Station in the Buffalo market.
  • Not surprisingly, the Washington, D.C., metro area had the largest military footprint of the 10 markets: the Pentagon, Bolling Air Force Base, Fort McNair, Walter Reed Medical Center, Marine Barracks and Washington Navy Yard are within its limits.

The 10 markets are ranked according to population, sales volume, and median sales price appreciation. Population was weighted most heavily in the rankings, followed by sales volume in proportion to population and rate of price appreciation.

THE 10 MARKETS

1. Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.Va.
2. Buffalo-Niagara Falls, N.Y.
3. Des Moines, Iowa
4. Portland-South Portland-Biddeford, Maine
5. Kennewick-Richland-Pasco, Wash.
6. Fargo, N.D.-Minn.
7. Burlington-South Burlington, Vt.
8. Bloomington-Normal, Ill.
9. Bismarck, N.D.
10. Elmira, N.Y.

ADDITIONAL DATA and CHARTS

REPORT METHODOLOGY

DOWNLOAD THE FULL REPORT (PDF)

 

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Submitted by David Losh on March 11, 2011 - 10:05pm.

OK, let's recap the methodology.

First you looked at QE II, and Bernanke's failed policy of kick starting inflation.

Second you looked at the debt structure of consumers in the emerging markets, particularly China.

Third was a considered look at food shortages, which some claim are due to investor speculation in commodities.

With all of that data coming in some are forgetting that Greece, Spain, Ireland, and Italy have financial strains that are also straining the Euro.

What that means to home ownership is a declining asset price.

Mortgages, if you have one, will be a continued debt trap. The loss of billions of dollars of equity in Real Property that has already occurred should give any one pause before making a purchase.

Real Estate is a business. Before any one buys a property they should have a business plan and exit strategy.

Nothing presented here is tangible data. It is sales statistics based on speculation. From what I can see the speculation here is poorly researched.

Government will be shedding jobs. Read the Republican mandate. Health Care is headed for Reform. Follow the discussion on Obamacare.

Those are just two examples.

Consumers need to look further than feel good press releases when making a family home purchase.

The family home is for housing stability, and creating financial security for our children.

 
Submitted by David Losh on March 13, 2011 - 2:25pm.

This is a weird little blog site.

Why would any one pay to read these opinions?

 
Submitted by Roger Ewing on March 14, 2011 - 7:54am.

Call me a southern California snob if you choose to. But I don't see a community on this list that would be a popular place to live. And, given the large GDP contribution that real estate makes to the national economy, I believe that without a healthy real estate market in the large metro areas, it will be difficult for a full economic recovery to occur in the US.

 
Submitted by Gerald Walters on November 22, 2011 - 4:19pm.

David haha
Had to respond to you, but yes these opinions are more common sense.
Gerald
http://www.bottled-hcg-diet.com/