San Diego Housing Market: Most Overpriced in Nation

Why are San Diego mortgage defaults on the rise? The ranking of this city in a recent poll may reveal the answer.

According to Forbes.com - in a ranking of the country’s 40 largest metro areas - this region is the nation’s most overpriced real estate market.

“Had the weather been included as a statistical measurement, there’s no doubt that San Diego would have avoided our list of the top 10 most overpriced cities – but we didn’t factor in sunshine,” report author Matt Woolsey said.

He added that rankings were based on a complicated mix of a theoretical “price-to-earnings” ratio – attempting to measure the price a California mortgage loan borrower paid for every $1 in return – and housing affordability.

The county, where the median price is $560,000 for a single-family resale home, did not rank first in any individual measurement, but high rankings overall landed it at the top of the “overpriced” list. This would explain why so many individuals need to apply for bad credit home loans in order to reside in the state.

The Miami housing market– another area known for sunshine – was No. 2. California held half the top 10 spots: Sacramento, No. 3; San Francisco, No. 4; Los Angeles, No. 8; and San Jose, No. 10.

Forbes also identified a list of least-overpriced markets/most affordable (none in California). Tops was Charlotte, North Carolina housing market where the median stands at $190,600 and home prices are up 8 percent over last year.