The housing industry is being scrutinized for signs of improvement, with many predicting a recovery, many predicting a double-dip and others expecting continued sideways movement. Clearly, what’s coming next is far from certain.
One reason for such mixed reports is the variety of statistics being looked to as indicators. And even when one of those statistics is clearly moving in a good (or bad direction), the results are far from uniform across the nation.
So, we looked at five such statistics — total inventory, median list price, percent of distressed sales, median days on market and median price per square foot — to find out where things are the most extreme.
Using data provided by Movoto Real Estate — a real estate database and licensed brokerage in 30 states that connects prospective home buyers with accurate listings, top-rated agents and photo galleries — here are the best and worst cities by those five standards:
Total inventory is the number of homes available for sale at the end of each month for existing and new homes, including single-family homes, townhomes, condominiums and co-ops.
Homebuilders keep a close eye on this statistic because it’s a very good indicator of housing demand, and its movement can give insight into the health of a housing market.
Best: Lousiville, Ky.
The lowest inventory can be found in Lousiville, where in July and August the number was a mere 62 homes. So few homes hitting the market means those up for sale are in high demand — evident by the city’s above-average median list price.
In Chicago, on the other hand, total inventory was more than 10,600 homes in August — just over three times the average for all cities and even after falling by around 300 from July. Such an oversupply is part of the reason the median list price for the city has dropped below $200,000 — well below average.
Median List Price
If you weren’t sure what this meant when it was just mentioned, here’s a little explanation. The median list price is the middle price of listed properties. To put it simply, it’s the price at which half of list prices are of lower value and half are of higher value.
Best: San Francisco
The area with the most expensive median list price is all the way west in San Francisco — further showing why a low total inventory is a good thing.
San Francisco had one of the lowest five inventory totals in August, and its number also fell 40% year-over-year the month before, according to the Home Buying Institute. And that means the homes available were in high demand, with a median price of $819,000.
That’s around $500,000 more than the average for all cities and more than a 15% year-over-year increase. So if you’re a seller, the City by the Bay is a great place to be.
The other extreme is Detroit, which has a median list price just under $13,000.
The relationship between inventory and price still holds true here: Detroit has an above-average total of more than 3,400 — more than six times San Fran’s inventory.
And if you consider the city’s struggles with the auto industry, and the fact its metro area was also the cheapest market for all of Q1, this news is far from surprising.
This is the percentage of homes sales that take place under some circumstances placing urgency on the seller, such as impending foreclosure, divorce or relocation. Such urgency means the sale is often short, discounted or even at a loss.
Overall, this number has been falling since the depths of the housing crisis: Distressed sales accounted for 50% of transactions in 2009 and only 25% of late. And in the cities that provided data to Movoto, the average percentage was just over 13% in August.
Best: Nashville, Tenn.; Fort Worth and Houston, Texas
Head down south, and distressed sales haven’t been much of an issue at all. In Nashville, Fort Worth and Houston, only 1% of August sales took place under distressed conditions.
Worst: Long Beach, Calif.
Long Beach, on the other hand, had the greatest percentage of distressed home sales in both July and August, with 19% and 18%, respectively. Detroit, once again, and Phoenix were both also in the back of the pack with 16% distressed last month.
Banks are also sitting on a large number of distressed properties that they haven’t put on the market yet — properties that could also further drive down prices when if flood the market.
Median Days on the Market
This is a pretty straightforward one: It’s the same deal as with median list price, but it tells you how long a property has been listed rather than how much it’s selling for.
A market with lots of lingering houses could, of course, be down, while individual houses that struggle to be sold may be overpriced or less desirable.
And if houses are quickly hopping off the market, there’s usually a good reason for that, too.
Best: San Jose, Calif.
California, in this case, is still a good place to be. The median amount of time that houses were on the market in San Jose was less than a month — only 27 days — in August. The average for this measure was double that, while many markets moved significantly slower.
The worst of those markets was, once again, good ol’ Detroit. In August, the average number was 128 days — another not-so-bright sign for the city. That comes to a median listing length of over four months, meaning half sat on the market even longer than that, and making Detroit the only city that broke into triple digits for the statistic.
Median Price Per Square Foot
We already looked at median listing price, but the median price per square foot is meant to give a more level playing field for price comparisons. Sometimes, homes cost more because they’re simply worth more, and they’re often worth more because they’re bigger. So, by looking at the price per square foot, you will in theory get a more accurate comparison of various markets.
Even with this leveled-out statistic, though, the results are exactly the same when it comes to the extremes. Some cities did see some significant changes — Baltimore and Sacramento, for example, both jumped up the list in price, while San Antonio’s ranking took a pretty big hit — but the best and worst were unchanged.
Best: San Francisco
San Francisco remained No. 1 for median price, even when adjusted for house sizes. While the average median price per square foot for the cities provided came to just over $170 for the month, San Francisco more than tripled that with a price of $590.
And again, leveling the playing field wasn’t enough for Detroit, which is still stuck in dead last — giving it the unwanted title of “worst” for three of the five categories. In August, homes on the market were listed at only $12 per square foot.