Study finds homes overvalued by nearly 21 percent
It’s tougher these days for homebuyers in the San Antonio area to get their money’s worth, but they’re still better off than their counterparts in Austin.
Professors at Florida Atlantic University and Florida International University recently examined the nation’s most overvalued housing markets based on current and past pricing trends. They ranked San Antonio 48th, with homes selling for 20.99 percent above anticipated prices based on long-term pricing patterns.
That was better than the situation in Austin, which the study found has the nation’s second-most overvalued residential real estate, with homes selling at a premium of 50.72 percent. It was better than Dallas-Fort Worth, too, which ranked 19th at a premium of 31.57 percent. Houston was 57th at 17.99 percent.
Homebuyers in the hottest markets are paying top dollar and could wind up having to hold onto their property for a while before they’re able to see a return, said Ken H. Johnson, a real estate economist and associate dean at FAU’s College of Business.
“In the top 10 markets, potential buyers might want to consider renting and reinvesting money that they otherwise would have put into homeownership,” he said. “Renting and reinvesting has been shown to often outperform ownership in terms of wealth creation.”