Fitch Ratings says Texas homes 'overvalued.' But are they?Fitch Ratings says Texas homes 'overvalued.' But are they?https://www.recenter.tamu.edu/news/newstalk-texas/?Item=171992017-07-21T05:00:00Z2017-07-21T17:00:00Z

​​​​NEW YORK – San Antonio and Austin top the list of five most overvalued housing markets in the country, according to Fitch Ratings.

Using five metrics, Fitch determined 27 percent of the 412 housing markets it tracks are overvalued, with home prices at least 5 percent above fair local value. Those metrics were nominal income growth, population growth, unemployment, change in rental prices, and change in home prices.

​The list is based on the year-over-year change in these measures for the 50 largest metropolitan statistical areas in first quarter 2017.

At number one, San Antonio's median home price was $202,600, overvalued by 18.6 percent, Fitch found. Number two Austin's median price was $286,400, overvalued by 17 percent.

However, Real Estate Center Research Economist Dr. Luis Torres said determining whether a market is overvalued is always difficult, but especially when a market's housing inventory is low.

Last month, the San Antonio-New Braunfels MSA had a 3.7-month's supply of homes for sale. Austin-Round Rock had a 3.1-month's supply. Statewide, inventory is at 4.1 months.

"We have a supply constraint issue in home construction," Torres said, "especially in the price ranges below $250,000. Nevertheless, this is obviously an important issue and one the Real Estate Center will continue to monitor. In fact, we're working on an article based on the Case-Shiller methodology ​of estimating actual prices based on fundamentals of demand and supply, and we found some price misalignments for Texas and the four MSAs."​

https://www.forbes.com/sites/samanthasharf/2017/07/19/texas-is-home-to-the-most-overvalued-housing-markets-in-america-2017/#15222fa93906Read more at {Source}

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