The housing stock in Orange County and the Inland Empire was “overvalued” as of August, while home values in Los Angeles County and the overheated San Francisco peninsula were not, according to a recent analysis by Irvine-based real estate data firm CoreLogic.
Other overvalued housing markets in the nation included the New York metropolitan area, Houston, Denver, Las Vegas and Miami.
In addition to L.A. County and San Francisco, Boston and Chicago markets were deemed to be “at value” in CoreLogic’s latest “Market Conditions Indicators” report released Tuesday, Oct. 3.
Forty-six percent of the nation’s 50 largest metro areas were overvalued, 16 percent were undervalued and 38 percent were valued just right, the report found.
“Nearly half of the nation’s largest 50 markets are overvalued,” said Frank Martell, president and CEO of CoreLogic. “The lack of real estate affordability has spread beyond the typically expensive coasts into the interior of the nation, hitting cities such as Denver, Nashville, Austin and Dallas.”
When increasing the sample size to the nation’s 100 biggest metro areas, a third of the U.S. housing markets were found to be overvalued.
The analysis categorizes home values by comparing current home prices to their long-run, sustainable levels and to local market fundamentals such as disposable income, CoreLogic said.
An overvalued housing market is one in which home prices are at least 10 percent higher than the long-term, sustainable level, while an undervalued housing market is one in which home prices are at least 10 percent below the sustainable level.
CoreLogic didn’t provide any other reasons while the San Francisco market — which has some of the least affordable housing prices in the nation — is “at value” and the relatively affordable Inland Empire is “overvalued.”
But demand is exceedingly high in the Bay Area, with high-paying jobs from the high-tech sector pushing the August median house price…