Prices Stabilize in Some Metro Areas

From a recent news feed come this story - PMI Mortgage Insurance Co., one of the largest providers of mortgage insurance in the country, ranks the nation’s 50 largest metropolitan statistical areas according to the likelihood that home prices will be lower in two years. The Fall 2008 Risk Index is based on second-quarter Office of Federal Housing Enterprise Oversight (OFHEO) data.

Risk scores of less than 10 percent aren’t statistically significant, according to David Berson, PMI's Chief Economist and Strategist. But in some areas where prices rose the most during the housing boom, the risk of price declines remains high.

The highest risk of future price declines are in Fort Lauderdale-Pompano Beach-Deerfield Beach, Fla. (99.5 percent), Riverside-San Bernardino-Ontario, Calif. (99.5 percent), Orlando-Kissimmee, Fla. (99.4 percent), Miami-Miami Beach-Kendall, Fla. (99.3 percent), and Tampa-St. Petersburg-Clearwater, Fla. (99 percent).

The 15 areas where the risk of price declines is less than 1 percent are:

St. Louis, Mo.-Ill.
Milwaukee-Waukesha-West Allis, Wis.
Charlotte-Gastonia-Concord, N.C.-S.C.
Cincinnati-Middletown, Ohio-Ky.-Ind.
Denver-Aurora, Colo.
Columbus, Ohio
Austin-Round Rock, Texas
Kansas City, Mo-Kan.
Indianapolis-Carmel, Ind.
Memphis, Tenn.-Miss.-Ark.
San Antonio, Texas
Pittsburgh, Pa.
Houston-Sugar Land-Baytown, Texas
Dallas-Plano-Irving, Texas
Fort Worth-Arlington, Texas

You’ll notice that our area is not on either list and that’s probably as good as we could have hoped for. To read the complete report, click here; or, to just see the index that ranks the major metropolitan areas, click here. The Detroit metro area and the Ann Arbor area both ranked LOW in risk for further price declines in this report. That’s probably because we’ve been leading the fall in values and have bottomed out already. We are hopefully poised to head back up, soon. Maybe we can at least catch our breaths, try to sell off some of the inventory overhang this winter, and be ready for a full recovery next spring. Let's all hope!