Only 3 States with Appreciation
It’s getting harder and harder to find housing markets that are doing well in what has developed into a national housing depression in most places. But there are 3 states with enough markets that are appreciating to still make the Housing Predictor top appreciation list.
Texas, Oklahoma and North Dakota are the exceptions to the rule. Their majority of housing markets are experiencing appreciation or at least have enough market exceptions forecast to inflate over the rest of 2008, to remain on the list. North Dakota, however, is now the only state among the three with local housing markets experiencing only appreciation.
Heavy oil and natural gas reserves are greatly benefiting all three in the nation’s energy crisis.
The over-whelming majority of states are in real estate depressions, according to the latest survey of real estate markets by Housing Predictor. All-time record foreclosures precipitated by new creative mortgages have generated major economic issues for the overall national economy. Congress is working on a plan, but there seems to be little hope that it will do much to help the ailing real estate economy. President George W. Bush is threatening to veto it.
Oklahoma and North Dakota have rich reservoirs of natural gas and Texas is protected largely by the oil industry. The foreclosure crisis is only beginning to affect some Texas markets, particularly some areas of Houston and Dallas.
Two other states, Washington and Utah, were just de-listed from the appreciating list. The majorities of their markets are now heading for deflationary cycles or are forecast to see housing deflation through the remainder of the year. Washington and Utah had two of the strongest statewide economies in the nation until the credit crunch started to meltdown.
Although home prices have leveled off in most of both states, and inventories of properties for sale have risen, their local economies are comparatively healthy to the rest of the nation. Job losses are mounting in many areas as many people lose their homes to foreclosure.
Many new businesses have moved to or been started in Texas, which has one of the strongest economies in the nation and one of the lowest tax bases being just one of five states with no state income tax. The U.S. Census Bureau forecasts Texas to grow to a point where its population is equal to California within a decade.
North Dakota is the biggest exception of all states in America’s real estate landscape. It’s one of only two states in the country to have home sales increase in the latter part of 2007, and it is the only state that has actually dodged subprime fallout. Mortgage lenders just didn’t offer much subprime financing or new creative loans in North Dakota, which protected the state’s economy to a large degree.
However, these days it’s harder and harder for many people to get a mortgage, which could make a damaging impact on its markets eventually.