 When it comes to consuming information, brevity rules the day. We like sound bites, info-graphics, and other quick-hit information that makes us feel we have a handle on things. The trouble is that in our rush to cram everything in, we often miss the deeper understanding.
You want me to get to the point? Sorry. Forbes recently came out with a list: Where U.S. homes are most overpriced. Other media outlets picked up that story, named the top 10 cities, and included a brief explanation. But what does overpriced mean in this instance? I hate to say it, but you may have to actually read the entire article.
Here’s my attempt at a one-sentence summary: In the most “overpriced” cities, homes stay on the market longer and eventually sell for prices further below asking price. Like I said, though, there’s more to it than that.
Just as important is what this list does not tell us. It’s not a ranking of the markets with the highest-priced properties. It does not point to where homes are selling for more than economists believe they are worth. There is no attempt to rank affordability by comparing home prices and incomes in the area. Rather, the list seems to be more about sellers being optimistic (unrealistic?) about what their homes are worth.
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You’ll find San Antonio at the sixth spot on this list, Austin-Round Rock 10th. The Houston area comes in 17th and Dallas-Fort Worth 21st. (The list ranks the 40 largest metro areas.) Read the entire article though, and you’ll find that it states that for San Antonio and Chicago, “By the strictest definition, they aren't tremendously overpriced.” The article goes on to say there are “more subtle signs” that those cities may be overpriced.
Go ahead. Read the whole thing. Better yet, find a source to help you sort out the information. If I were making a list of where you can get the best real estate analysis, I’d put Texas REALTORS® at the top. Markets change quickly and vary from one place to the next. Your Texas REALTOR® can help you understand pricing trends and effective strategies for selling, purchasing, or leasing in your area, whether your city is supposedly overpriced, underappreciated, or shrouded in hype in our sound-bite driven world. |
