In every industry, there are people that believe positive and people that take a look at things from more of a negative viewpoint. Even when things are going their finest and everybody involved is earning money hand over fist, you constantly have a devoted group of nay-sayers that are anticipating doom and gloom.
A few months earlier, those voices began to get louder and louder in the property market. The positive thinkers pointed to incredibly low home loan rates and record sales and said whatever was all right. Unfortunately, in this case, the doom and gloomers might have been on target.
A new study shows that an increasing variety of real estate markets in the United States may be miscalculated, and as the logic recommends, an overvalued realty market translates into a slower property market.
The main offender is rising rates of interest.
The rate for fixed mortgages (30-year) is up over half a percent in the past year, and the rates on adjustable-rate mortgages is up much more.
The real estate market that was deemed to be the most misestimated was in Naples, Florida, where the research study considered to be 101.5% higher than exactly what National City considered to be fair worth.
The city of Bend, Oregon was second in the study, being available in at nearly 90%.
If you’re searching for property markets that still have offers, visit the terrific state of Texas. All 5 of the most underestimated markets remained in the Lone Star State, led by College Station (home of the Texas A&M Aggies) which was deemed to be over 22% underestimated. Dallas was second on the list at 21% undervalued.
However how do you know if your real estate market is misestimated?
Possibilities are, if you reside in California or Florida, it is. 9 of the top 10 misestimated markets are in either Florida or California, with Salinas, Merced and Madera, California ranked 3, 4 and 5. Port St. Lucie, Florida is considered to be 74% miscalculated, sufficient for number 6. Stockton and Santa Barbara, California take 7 and 8, while Florida takes the final 2 spots at 9 and 10 with Miami (70.8%) and Punta Gorda (70.2%).
While this may be a sure sign of a pending real estate downturn, the best thing any possible investor can do is take a long, hard take a look at all available research before you decide to take a favorable or unfavorable outlook.