With national home values falling 26 percent since the market’s peak in 2006, it’s understandable that many people are gun-shy about entering the real estate market. But there are many places where affordability is at an all-time high, home values are stable and the local economy is strong. That means if you’re planning to live in your home at least 5-7 years, and have good credit, now can be a great time to buy in these markets.
Here at Zillow, we looked at four factors to determine the best places for buyers in 2011.
- Affordability - We looked at how affordable homes are for residents, compared with income, and how the current affordability compares with historic levels.
- Unemployment – We looked at areas with low unemployment as a proxy for the health and stability of the local economy. We also looked at unemployment trends over the past year.
- Foreclosure Frequency – We used Zillow monthly data on foreclosure statistics. A lower rate of foreclosures suggests a healthier real estate market.
- Price Appreciation – We looked for home value stability. It’s more attractive for a prospective buyer to buy in a city where the market feels stable and will continue to appreciate. Because so many markets are still declining, ones that have only modest declines in the past year are more attractive than ones with bigger drops because there’s lower volatility.
Announcing the Top 10 Best Places for Buyers in 2011:
To take a deeper dive into our methodology, visit the Zillow Research Blog.
By Jill Simmons, Zillow PR Manager