The Best & Worst U.S. Housing Markets

Live in the Seattle housing market?

If you own your home, chances are you’re celebrating.
Despite soaring Washington mortgage costs, the city’s median home price in the first quarter of this year hit $380,200, an increase of 12.3 percent from a year earlier, data from the National Association of Realtors shows.

Median home prices in the Pacific Northwest as a whole soared; in Portland, Ore., prices rose 8.9 percent, and in Salem, Ore., they grew 15.6 percent.

Southern metro areas also boasted gains. In San Antonio, low Texas home loan costs boosted prices 11.2 percent, and Austin, Tex., prices climbed 5.4 percent. Charlotte, N.C., and Raleigh, N.C., rose 6.4 percent, while Richmond, Va., and Norfolk, Va., improved 6.2 and 5.9 percent.

“What we’re seeing now are the areas which still have a strong economy, but didn’t have the overheated prices [during the housing market boom], are the ones that are holding strong now,” says Kermit Baker, a senior research fellow at Harvard University’s Joint Center for Housing Studies.

In the Northeast, the New York City metro area turned in a steady 1 percent gain, while smaller metros like Albany, N.Y.; Trenton, N.J.; and Allentown Pa. - which improved by 6.3, 7.1 and 5.8 percent - helped overcome lingering Boston mortgage woes to lift the Northeast to a 1.2 percent overall price growth. It’s the only region in the black.

Now the bad news.

Median home prices in Florida are down: Tampa by 2 percent, and Sarasota, Palm Bay and Daytona by an average of 9 percent. Overall, Florida home prices plunged 25 percent, making the Sunshine State not so sunny.

Miami, however, which was hamstrung early in the housing downturn, improved by 2 percent. The rally may be tenuous however, as 23 percent of Miami home loans are subprime, or bad credit home loans, according to First American LoanPerformance, a mortgage data provider.

“We’ve had about 30 subprime lenders go under, which leads to a tightening of credit,” says Jonathan Miller, president of Miller Samuel, a New York-based real estate appraisal and consultancy firm.

“That adds one more barrier to transactions, something that couldn’t have come at a more delicate time for the housing market. On a national level, there are a lot of markets which are going to have some problems.”

The Gulf Coast, where mortgage volume and home prices had roared back at a double-digit clip the year following Hurricane Katrina, is one such market.

Mississippi and Louisiana mortgage activity bounced back in certain areas. Biloxi, Miss., grew 15.7 percent, and Baton Rouge, La., by 9.7 percent, but a subprime hammer came down on New Orleans, where a 20 percent delinquency rate on subprime home loans contributed to an 11 percent drop in home values.

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