Are home prices in the Memphis area recovering? Can we expect an uptrend in coming months and years?
According to a Forbes-MSNBC piece Where Home Prices will Rise, Fall Most in ’11, Memphis ranks 4th among markets where prices will rise in 2011, with a projected 3.2% average year over year increase in property values.
Other markets among the Top 10 on the rise for 2011
1. Washington, DC: 6.5 percent price increase
2. Houston, TX: 3.6 percent price increase
3. Honolulu, HI: 3.4 percent price increase
4. Memphis, TN: 3.2 percent price increase
5. Columbus, OH: 2.1 percent price increase
6. Dallas, TX: 1.4 percent price increase
7. New York, NY: 1.3 percent price increase
8. Birmingham, AL: 0.9 percent price increase
9. Pittsburgh, PA: 0.8 percent price increase
10. New Orleans, LA: 0.5 percent price increase
Prices already on the upswing?
In current trends, Zillow shows an upward trend in prices over the last few months in in-city properties, but a slightly downward trend overall.
I have wondered for a while about the impact inexpensive properties have on median sales price numbers. One would think that the median price would be skewed downward by the huge numbers of houses that sell below $50K in this area (2380 units, or 27.63% of all homes sold in 2010). So increases in values across the market seem to indicate an extra bonus in home values.
While some areas suffered, I don’t think the Memphis market, overall, took the kind of hits that other cities like Phoenix and Las Vegas did. As is universally true, prices here are driven by supply and demand. The recession has brought with it a strong buyers’ market. Lack of demand, coupled with comparable property values dragged down by foreclosures, and, thus, lower appraisals.
I am much more interested in the Demand side of the housing equation. Unit sales dropped to record lows in 2010 (only 55.7% of units sold in 2005) as home ownership became a lower priority in these recessionary times. I think the true indicator of a strenghening market will be a consistent upward trend in the number of homes sold, regardless of price range. I would also like to see numbers on investor purchases vs. owner-occupant purchases, since Memphis is considered to be a lucrative investor market. The combined increases in price and number of owner-occupant will indicate a market in recovery.
The Forbes – MSNBC article also projects the 10 markets that will fall the most in 2011:
1. Virginia Beach, VA: 12.8 percent price decrease
2. New Haven, CT: 11.9 percent price decrease
3. Tucson, AZ: 11.9 percent price decrease
4. Dayton, OH: 11.7 percent price decrease
5. Jacksonville, FL: 10.5 percent price decrease
6. Phoenix, AZ: 9.4 percent price decrease
7. San Francisco, CA: 9.3 percent price decrease
8. Detroit, MI: 7.7 percent price decrease
9. Oklahoma City, OK: 7.6 percent price decrease
10. Tampa, FL: 7.4 percent price decrease
Related articles
- Memphis area home sales -December, 2010 and year end 2010 (memphisrealestatebuzz.com)
- America’s love affair with the house (memphisrealestatebuzz.com)
- Midtown Memphis residential sales – 2010 (memphisrealestatebuzz.com)
- Downtown Memphis residential Sales – 2010 (memphisrealestatebuzz.com)
- Downtown Memphis condo sales -2010 (memphisrealestatebuzz.com)
- Thank You, Essential Workers - September 7, 2020
- Mid-Century Modern for sale – 346 Waring, Memphis, TN - July 9, 2013
- RE Buzz – Real Estate News Roundup – July 9, 2013 - July 9, 2013
What do you think? Leave your comments.