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Are Home Price Values Finally Leveling Out?

real estate prices and valuesThe IHS Global Insight survey studied 330 metropolitan areas, and revealed that prices rose in 169 markets and fell in the remaining 161. The survey began in 2005 and this is the first time that there were no MSAs with prices deemed to be “extremely” overvalued.

“For the nation as a whole, the housing market is now slightly undervalued, 8.6 percent when weighted by market value and 10.1 percent when weighted by housing units,” IHS Global Insight said.

Pricing has made some strides recently and third quarter numbers by S&P Case-Shiller showed a 3.1% jump up although they were down 9% from the year before.

Interestingly, IHS reports that “only 16 metro areas have escaped net home price declines since the cycle began. All 16, except Pittsburgh, are in the center of the country, and six are in Texas. Two areas hit hard by the housing downturn – Los Angeles and Miami – recorded third quarter price increases above 4.0 percent.”

Are we nearing an economic recovery? What lessons should our nation have learned during this crash about real estate bubbles to avoid the next go around? Tell us your thoughts in the comments!

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Lani is the COO and News Director at The American Genius, has co-authored a book, co-founded BASHH, Austin Digital Jobs, Remote Digital Jobs, and is a seasoned business writer and editorialist with a penchant for the irreverent.

16 Comments

16 Comments

  1. Eric Hempler

    December 22, 2009 at 10:10 am

    In the Twin Cities prices seem to be leveling off. We’ve entered a balance market recently and I think Spring will be interesting to see what happens.

  2. Thomas A. B. Johnson

    December 22, 2009 at 11:49 am

    The 4th largest city in the US is apparently not significant enough to be included in the Case Schiller Index. I guess those yankees at Yale can’t tell the difference between Houston and New York City West, I mean, Dallas.

    As a result, I have provided our market with a website where you can track the residential real estate where it really matters: the local level. This is important because Case-Schiller does not know we exist. . Clients can track their neighborhood here:

    PropertyValuesinHoustonTexas.com

  3. Sal Antsipenka

    December 22, 2009 at 7:38 pm

    There is a very heated debate these days about the nearest future of real estate in US and the world. Many clients of mine are asking about the recent trends because they heard of a second real estate crisis possibly coming in 2010. So what could be happening in recent months?

    1. One group of real estate investment experts argues that you shouldn’t buy in 2010 at all because of several crusial investment factors. They argue that the low interest rates are the major factor. The lowest real estate prices should coinside with the highest interest reates not the lowest. If you buy a home with a mortgage today and the interest rates will eventually go up the home prices will go down again.

    Another reason to wait on investing into real estate is recent yields. The best time to invest is when the real estate prices are down and the yields are high, so some experts’ advice is to wait until 2011 when the real estate market will free itself from extremes.

    2. Second group of real estate experts argue that US home prices will definitely bottom out in March and that will be the best time to buy compared to December 2009 and the following winter months.

    3. There is an opinion that the recent crisis will have -W- shape instead of -V- shape, i.e. there will be a moderate rise and then another fall before the world economy stabilizes and real estate will steadily go up for some extended time. So the advice is to wait again.

    Here is what I think. You don’t have to think globally if you buy real estate. Check out what’s going on locally, because too many factors are important and come into play according to a specific situation. Major contributing factors are:

    1. Mortgage and mortgage rates

    2. Specific location and even specific community

    3. Single Family Home, Estate, Waterfront home or Condo

    4. Real local sales figures and demand

    5. What homes/condos go into foreclosure

    6. Your price range

    Naples Florida is a good example. A number of my clients learned the hard way that waiting 3-4 months in recent situation within a certain price range will only make you pay more or look longer if you want a newer home or condo under $300,000 which seems to be the market today. More expensive homes sell way slower and foreclosures and short sales a much fewer in middle and upper price ranges, so a possibility to snatch a great deal depends on your quick reaction and your competition.

  4. Simon

    December 22, 2009 at 8:58 pm

    I presumely feel we still have not yet found the levelling out in the real estate prices.
    If you look at whats happening in European part, Middle-east, the breeze has touched now there. If we look what happened in Japan 10 years back, the property prices are still no where at the mark they were before.
    So apparantelly, there is further more to drop. And it will take utmost 3rd Quarter of 2010 for things to show some good signs.
    I would say cash is the king at the moment.
    Thanks

  5. JR of Sun City Real Estate

    December 30, 2009 at 8:53 am

    Sun City have fairly well market too. I am confident that things will go smoothly especially for the first quarter next year.

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