Is there such a thing as zones around the country where real estate values are increasing, while other areas the real estate is in decline?
Ever sit around and wonder what part of the country might be the best to purchase your next home? If you could choose between Los Angeles and Miami, what would be the determining factors which might sway your decision from one coast to the other?
Well, wonder no more because Fortune has done their homework, and determined a rating system where you can easily access projected future property values and select a nice locale for your next property investment.
In their recently published Real estate survival guide: Welcome to the dead zone a team of authors canvas the U.S., researching the facts, and doing their best to explain what has happened to the real estate market over the last few years. They explain the dynamics which caused the huge run up in real estate values, and layout what the futue may have in store:
“One likely scenario is that housing prices would drop 10 percent to 15 percent in the bubble zone over the next 12 months, then remain flat for maybe four more years while incomes catch up.
But there’s another possibility. For the past few years the housing boom has driven the economy, adding jobs in construction, remodeling, and real estate services. And consumers gorged on the equity in their homes, taking out a total of $2 trillion via loans, refinancings, and sales over the past five years.
If corporate spending or some other force doesn’t come along to pick up the slack, we could go into a recession that would cut income growth to zero. Then inflated housing prices would have to shoulder the entire, wrenching adjustment, falling 30 percent or more over several years.”
The Fortune article breaks down the geographical locations of different zones using cute little “house” icons which direct you to cities around the USA that are catagorized into “zones”.
The (3) zones are:
Dead Zone: Boston, Las Vegas, Miami, Washington D.C./Northern Virginia, Phoenix, Sacramento, San Diego
Danger Zone: Chicago, Los Angeles, New York, San Francisco/Oakland Seattle
Safe Haven: Cleveland, Colombus, Dallas, Houston, Kansas City, Omaha, Pittsburgh
Difficult to report that Miami is in the Dead Zone; however, there are numereous explanations why real estate is in decline and the reality is, prices are dropping and it’s becoming a buyers market.
Who really cares about Cleveland being a safe haven, and I’m not moving to Omaha if they give me a free house.