License or reprint this slide show
printer-friendly without images

Slide Show | May 2013

12 Cities Where Home Prices Have Fallen Most

slideshow image

Thinkstock

Not all metropolitan areas in America have seen a housing rebound -- yet. These 12 cities with populations of 250,000 or more experienced drops in existing single-family home prices for the year ending March 31, 2013. But as you’ll see, signs of recovery are showing in some of these lagging markets. Prices come from Clear Capital, a provider of real estate data and analytics.

Many of these cities still have an oversupply of homes on the market and high unemployment rates. More importantly, half or more of all distressed sales (which include foreclosures as well as short sales) are bank-owned properties (REOs), according to CoreLogic's February data. Bank-owned properties sell with the greatest discount from market value, further depressing overall home prices. Another drag on a rebound: By and large, these cities haven’t attracted out-of-town real estate investors the way other cities such as Phoenix, Atlanta, and Las Vegas have.

U.S. BENCHMARK STATISTICS: One-year change in home prices: 6.8%; Median home price: $177,500; Change in price since 2006 peak: -33.8%; Unemployment rate: 7.5% (seasonally adjusted), 8.1% (non-adjusted). City-specific unemployment rates to follow are non-adjusted; Foreclosure rate: 1 in every 296 households (0.34%); Distressed sales: 23.4%

Sales, supply and other market data come from regional associations of Realtors and multiple-listing services. Foreclosure rates are from RealtyTrac. Home prices are from Clear Capital. All home price data is for existing single-family homes only. Distressed sales statistics are from CoreLogic.


12 Cities Where Home Prices Have Fallen Most

1. Montgomery, Ala.

slideshow image

Thinkstock

One-year change in home prices: -14.5%

Median home price: $86,000

Change in price since 2006 peak: -45.8%

Unemployment rate: 7.9%

Foreclosure rate: 1 in every 517 households (Low)

Distressed sales: Not available

In Alabama's state capital, the supply of homes for sale in March was 8.9 months, well above the four to six months’ inventory that represents a balanced market between buyers and sellers. The number of homes sold grew by 22.3% in the past year, but homes lingered on the market for an average of 115 days (in a normal market, homes sell in 60 days, on average). Demand for homes this year should be bolstered by a slowly improving economy, especially in Alabama’s automotive manufacturing industry, according to University of Alabama economists.

1. Montgomery, Ala.

2. South Bend, Ind.

slideshow image

Thinkstock

One-year change in home prices: -11.7%

Median home price: $62,000

Change in price since 2006 peak: -43.3%

Unemployment rate: 10.2%

Foreclosure rate: 1 in every 478 households (Low)

Distressed sales: 25.5%

Despite the decline in prices over the past year and a high unemployment rate, the housing market in South Bend has begun to recover. Buyers have plenty of homes to choose from, with 7.3 months' supply in March (down from 8.9 months last year). Sales rose by 6% so far this year compared with last year. Investors (even some foreign ones) are active here, but not nearly to the same extent as in cities like Phoenix and Atlanta, says Quinn Thurin, with Cressy & Everett Real Estate. Sellers received just 86% of their list price over the past year. That suggests that they continue to price their homes too high for the market (95% or higher means list prices are on target).

2. South Bend, Ind.

3. Winston-Salem, N.C.

slideshow image

tweber1 via Flickr.com

One-year change in home prices: -10.9%

Median home price: $95,050

Change in price since 2006 peak: -26.0%

Unemployment rate: 8.8%

Foreclosure rate: 1 in every 241 households (High)

Distressed sales: Not available

Buyers are sitting in the catbird’s seat in Winston-Salem, with 11.3 months' supply in March. The inventory of homes for sale has barely budged in the past year. But things are looking up for sellers: The number of homes sold increased by more than one-third compared with a year ago, and more than half of listings sold within 90 days.

3. Winston-Salem, N.C.

4. Trenton-Ewing, N.J.

slideshow image

Thinkstock

One-year change in home prices: -8.1%

Median home price: $129,500

Change in price since 2006 peak: -43.2%

Unemployment rate: 7.6%

Foreclosure rate: 1 in every 385 households (Low)

Distressed sales: 14.4%

Trenton is the capital of New Jersey and the county seat of Mercer County. The total inventory of homes in Mercer County fell by nearly one-fourth in March from a year ago, but with 9.5 months' supply, the market still favored buyers. Even so, buyers weren’t house-hunting in droves -- the number of homes sold fell by 7% from the year before. Homes took an average of 109 days to sell, but at least sellers received an average of 96% of their original list price.

There was more activity in the more desirable and prosperous suburban markets, such as West Windsor, where the schools are considered a good alternative to pricier Princeton.

4. Trenton-Ewing, N.J.

5. Manchester-Nashua, N.H.

slideshow image

Magicpiano via Wikimedia.org

One-year change in home prices: -8.0%

Median home price: $200,000

Change in price since 2006 peak: -40.6%

Unemployment rate: 6.0% (Manchester only)

Foreclosure rate: 1 in every 351 households (Low)

Distressed sales: 35.9%

In New Hampshire's largest metro area, "things are improving, but let's not break out the punch bowls yet," says Bill Weidacher, president of the New Hampshire Association of Realtors. In March, the number of homes sold grew by 9.6% from a year ago, and they sold in an average of 94 days. Inventory remains tight, and the number of new listings coming to market actually fell by 4.5% from last year -- all good news for sellers. But prices remain depressed by lack of job growth and the steady, though declining, rate of foreclosures.

5. Manchester-Nashua, N.H.

6. Green Bay, Wis.

slideshow image

Bobak Ha'Eri via Wikimedia.org

One-year change in home prices: -7.9%

Median home price: $181,500

Change in price since 2006 peak: -19.2%

Unemployment rate: 7.6%

Foreclosure rate: 1 in every 264 households (Average)

Distressed sales: 3.1%

Despite a brutal winter, real estate agents in northeast Wisconsin agree that the home market is showing signs of new growth. “We have had as close to a normal spring sales season as we have had since 2007, when we had motivated buyers and sellers in the market at the same time," says Jim Smith, of W.E. Smith Realty.

A supply of 6.9 months in March still somewhat favored buyers. The number of homes sold is down 7.2% from the year before, but sellers received an average of 97% of their original list price -- a healthy sign. Smith thinks buyers are beginning to realize that they need to take advantage of low prices and interest rates while they can.

6. Green Bay, Wis.

7. Scranton/Wilkes-Barre, Pa.

slideshow image

Thinkstock

One-year change in home prices: -5.8%

Median home price: $82,250

Change in price since 2006 peak: +22.7%

Unemployment rate: 10.2%

Foreclosure rate: 1 in every 610 households (Low)

Distressed sales: 25.9%

In the first quarter of 2013, it appeared that the market in this northeastern Pennsylvania metro area had turned the corner. Sales rose by 12.6% in Scranton (Lackawanna County) from the year before; pending sales (homes under contract, but not yet closed) increased 20.7%. Scranton and Wilkes-Barre have the second-most elderly population in the country, but their affordable downtowns are enjoying an influx of young professionals and empty nesters, says Wayne Evans, president elect of the Greater Scranton Board of Realtors. That’s boosting home sales. He notes that the local economy, though improving, isn't "out of the woods yet," but expects that it will be more positive by the end of 2013.

7. Scranton/Wilkes-Barre, Pa.

8. Atlantic City, N.J.

slideshow image

Thinkstock

One-year change in home prices: -5.2%

Median home price: $172,700

Change in price since 2006 peak: -42.3%

Unemployment rate: 14.8%

Foreclosure rate: 1 in every 355 households (Low)

Distressed sales: 25.8%

There's not much good news in Atlantic City's housing market, with the economy still stinging from the effects of Hurricane Sandy. Corinna Haberkern, of Century 21, says New Jersey’s housing market has been slow to recover and that "they're still putting the pieces back together." A high rate of unemployment undercuts buyer demand, and the number of homes sold fell 5% from the year before. Average days on the market is 123. In February, the metro area staggered under 21 months' supply of homes for sale, despite a 9% decline in listings from the year before.

Buyers are more motivated now, Haberkern says, because they recognize that "prices are as low as they will go" and they want to lock in a low mortgage rate. And sellers are seeing more foot traffic. But they are holding out for higher prices and won't move unless they must. Plus, Haberkern says, the area is likely to experience another wave of foreclosures in the coming year, which depresses average selling prices.

8. Atlantic City, N.J.

9. St. Louis

slideshow image

Thinkstock

One-year change in home prices: -4.8%

Median home price: $63,000

Change in price since 2006 peak: -45.8%

Unemployment rate: 8.0%

Foreclosure rate: 1 in every 292 households (Average)

Distressed sales: 28.6%

St. Louis’s economy is stable, but it’s not growing, and population growth is flat. Even so, most signs indicate that its real estate market is moving in the right direction, says Donna Zerega, of the St. Louis Association of Realtors. In St. Louis County, the most populous county in the metro area, had four months' supply of real estate in March (down from seven months’ supply a year ago). Total listings of homes for sale fell by one-fourth from a year ago, while the number of sales rose 14%. Homeowners waiting for a better market began to list their homes for sale, but they still couldn't be aggressive with their pricing.

9. St. Louis

10. Charlotte, N.C.

slideshow image

Thinkstock

One-year change in home prices: -4.4%

Median home price: $118,000

Change in price since 2006 peak: -20.4%

Unemployment rate: 9.4%

Foreclosure rate: 1 in every 236 households (High)

Distressed sales: 20%

The housing market in Mecklenburg County, a major financial center, appears to be turning around, even though unemployment is still a problem. Pent-up demand boosted sales by 29% over the past year, and sellers have more leverage over buyers: Months’ supply is only 3.2 months (down from eight months last year), and there’s about half as much inventory as last year. On average, sellers received 95% of their asking price, although their homes took 103 days to sell.

10. Charlotte, N.C.

11. Greensboro-High Point, N.C.

slideshow image

Beyonce245 via Wikimedia.org

One-year change in home prices: -4.3%

Median home price: $80,000

Change in price since 2006 peak: -23.5%

Unemployment rate: 9.9%

Foreclosure rate: 1 in every 264 households (High)

Distressed sales: 20.3%

As in the Charlotte metro area, buyers in Guilford County are bucking a tepid economy and high unemployment rate and pushing up the rate of home sales -- which rose 30% compared with last year. Guilford County’s supply of homes stands at 5.1 months -- a balanced range. Homes took an average of 103 days to sell -- not terribly fast -- but sellers received 94% of their listing price.

In any metro area, supply varies by community and price category. Sellers at the high end of the market (homes over $500,000) must still be patient, with almost two years of supply. In March, the months' supply in the county’s communities ranged from a low of 5.9 months to a high of 24 months.

11. Greensboro-High Point, N.C.

12. Baton Rouge, La.

slideshow image

Wikimedia.org

One-year change in home prices: -4.1%

Median home price: $115,500

Change in price since 2006 peak: -13.7%

Unemployment rate: 5.5%

Foreclosure rate: 1 in every 306 households (Average)

Distressed sales: 18.4%

Prices in Louisiana’s capital bumped up after Hurricane Katrina, peaked in early 2009 and then retreated, largely as a result of the recession. Now the market has picked up again as buyers have regained jobs and confidence. In March, sales rose by 16.9% and inventory fell by almost 10% from the year before. With a months' supply of 5.3, buyers and sellers enjoyed almost equal advantage. Sellers found buyers in an average of 92 days but received an average of 97% of their original list price.

12. Baton Rouge, La.

You Might Also Like...

12 Cities Where Home Prices Have Risen Most

Thinkstock


This page printed from: http://www.kiplinger.com/slideshow/real-estate/T010-S001-12-cities-where-home-prices-have-fallen-most/index.html

All contents © 2014 The Kiplinger Washington Editors