Forbes.com examined the nation’s 40 largest metros and identified the 10 housing markets that are in the worst shape. These are the markets Forbes cited:
1. Detroit – Foreclosures are five times the national average. The median home price is $132,900.
2. Orlando, Fla. –The home vacancy rate is 7.4 percent. Median home price is $245,000.
3. Cleveland – Job growth here has been minimal since August 2006. Median home price is $139,900.
4. St. Louis – Year-over-year home prices dropped 20 percent. Median home price is $169,900.
5. Miami – The inventory of unsold homes has climbed steadily. Home prices have plunged 19.3 percent from January 2007 to January 2008. Median home price is $295,000.
6. Las Vegas – Job growth has been flat. The city ranks among the top in the nation with foreclosures. Median home price is $266,000.
7. Sacramento, Calif. – The city has the nation’s highest rate of seller price reductions. Median home price is $309,900.
8. Denver – The state has ninth-highest rate of foreclosures in the country. Median home price is $259,000. 9. Tampa, Fla. – This metro area is experiencing weak job market and high inventory of premium properties. Median home price is $219,000.
10. Phoenix – Housing inventory is five times higher than it was in 2005. Median home price is $265,000.
The riskiest markets were those that had the highest foreclosure rates, slow job growth (or high job loss) and a high number of listed homes for sales, according to Forbes. By these measures, Orlando fares the worst. Other areas, such as Denver, exhibit negative characteristics like foreclosures, lending problems and vacancies, but are adding jobs, which is a sign that the local economy can better handle these difficulties, the article reports.
Cities most affected by the downturn were old-line industrial markets such as Detroit, where local economies are suffering the effects of mass layoffs in the auto industry. Excess inventory in cities like Orlando and Miami has severely dented home values. The areas hit hardest by the housing crisis are also starting to affect municipal budgets. States like California, Nevada and Arizona, expect to lose a combined $6.6 billion in tax revenue next year, according to a report prepared for the U.S. Conference of Mayors.
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