For cities that suffered a decline in home prices and are now seeing an improvement, the situation might still be volatile. Some cities had home prices that reached rock bottom and are still at the bottom, having had marginal improvement. Other cities declined from top prices and are now showing an increase. Still more cities never suffered a decline and are still seeing rises in price. It must also be noted that the rising prices may be from investors who are snagging dirt cheap homes and looking for a future turnover and profit.
This article will cover the first two categories, and Yahoo Real Estate has a few answers for cities with a population of 200,000 or greater. The article also gives critical information about foreclosure rates and unemployment rates for each city.
Rochester, New York: a one year change of 6.7% to a median home price of $114,900.
Utica-Rome, New York: a one year change of 8.8% to a median home price of $94,700.
Ann Arbor, Michigan: a one year change of 9.4% to a median home price of $185,000.
Bridgeport-Stamford, Connecticut:a one year change of 10.0% to a median home price of $497,500.
Cape Coral-Ft Meyers, Florida: a one year change of 12.1% to a median home price of $100,000.
The prices of rental home prices can not be ignored. Surprisingly, even where home prices are not rising, rents are managing to go up. According to the New York times, some cities are seeing rental rates rise as the technology industries and other firms are hiring. Others are seeing home prices continue to drop while rental prices are actually increasing.
San Francisco, California; Austin, Texas; and Boston, Massachusetts are three cities where tech and other firms are hiring and the rents are rising. But Chicago and Seattle are seeing rising rents at the same time the home prices are continuing to fall. One explanation for the Chicago and Seattle problem could be that, as various rounds of home foreclosures have completed, the former home owners look for rental housing and apartments, which saturates the markets and causes rental rates to rise.
Even though interest rates are lower than ever and there is a high inventory of vacant homes, the former home owners seem inclined to rent for a longer time than normal. Retired former home owners may be finding renting to be a more appealing housing choice, as they are free of property maintenance and the other burdens of home ownership.
Also, as job markets are loosening up, more young people may be capable of getting out of their parents homes or ditching the roommates for their own rental space. Apartments, not houses, are presenting the more competitive rental market, however.
The fact is that America is more of a renting nation and probably will probably be that way for some time to come. This is because the job market has to get back to normal and new apartment and other rental construction has to spark up again.