The same report that I mentioned in the previous post also has a list of over-priced markets. Here’s an excerpt from an article about overvalued markets in the Rockies.
Of the cities surveyed in the Rocky Mountain West, St. George, Utah led with a median home price that is 52.5 percent above a reasonable market value. In the same quarter just two years ago it was 1.1 percent overvalued. The study determined that base market value by looking at house prices, interest rates, population densities and historical premiums and discounts.
Boise came in second at 28.6 percent more than market value. Two years ago, the overvaluation was at 1.4 percent. Grand Junction, Colo. came in third at 27.8 percent above and Farmington in New Mexico was next at 22.5 percent.
Elsewhere in the Rockies, the overvaluation numbers look like this:
Greeley: 20.8 percent (down from 24 percent two years ago)
Boulder: 15.6 percent (down from 24.8 percent two years ago)
Provo: 11.9 percent (up from 10.6 percent two years ago)
Fort Collins: 9.6 percent (down from 15.5 percent two years ago)
Billings: 8.3 percent (up from 22.7 percent two years ago)
Salt Lake City: 8 percent (up from 10.6 percent below market value in 2004)
Albuquerque: 8 percent (up from 5.7 percent below market value two years ago)
Colorado Springs: 6.4 percent (down from 9.1 percent above in 2004)
Denver: 5.9 percent (down from 13 percent two years ago)
And, some big ones near the region:
Bend, Oregon: 76.4 percent (up from 22.7 percent two years ago)
Medford, Oregon: 66.4 percent (up from 25.7 percent in 2004)
Spokane: 23.2 percent (up from .2 percent in 2004)
Prices can swing from being grossly undervalued to highly overvalued, so there’s
no need to panic if you’re investments are listed. You want to look at population and job growth[yet again] and other factors. But its time to start looking for the exit strategy. Places like Bend and Medford should definitely be avoided. St. George and Boise warrant further inspection.