In the wake of the Great Recession, real estate agents have enjoyed an economic recovery lasting more than eight years with sustained job growth and GDP increases, and — for the last few of those years — income increases.
However, there are some markets that aren’t getting to taste the rebound.
A CBS News report cited data released by Zillow that indicates that lower-priced homes are recovering value more slowly than those with higher prices.
As is to be expected, coastal cities are making headlines for increasingly unaffordable housing, more than half of the homes in the country — 53 percent — haven’t regained what they were worth at the peak of the housing bubble in 2007.
Across the nation, 1 in 20 mortgaged homes is still worth less than the mortgage owed on it, according to CoreLogic.
In the Bay Area, even the cheapest 30 percent of homes are up by as much as 20 percent over their 2007 value. But it’s a different story inland. In Stockton, the cheapest third of homes are worth 17 percent less today than 10 years ago.
The Villages, Florida, is the only locality in the entire Sunshine State where the cheapest homes are now worth more than they were at the peak of the bubble.
Detroit has been uneven in its recovery. Svenja Gudell, Zillow’s chief economist, noted the median home in the top tier is now worth $284,800 — more than it was at the peak of the housing bubble. The median lowest-tier home is worth just $53,000. Just one in 10 of those homes has regained the value it lost in the crash.
People who lost a home to foreclosure during the bubble would have to wait seven years before they could buy again, which would be 2015 or 2016. However, they may find that properties are now out of their reach.
Gudell said changing the trend will not be easy and will include wage increases, particularly for the lowest earners; building a lot of new housing, also for the lowest earners; or a combination of the two.
“We will see more and more disparity between the people who are homeowners and the people who aren’t homeowners, or the people who bought during a lucky time and those who bought during a not-so-lucky-time.”