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Nice find CMG.
http://www.forbes.com/home/2008/10/1...ealestate.html
The economic storm sweeping the country has left Americans with few places to hide.
But those looking to hunker down might want to head to Texas, where they can get the best value for their dollar.
That's because Austin and San Antonio lead our list of places where your money goes farthest. Residents of both enjoy affordable housing and promising prospects for job growth in coming years. Houston and Dallas also land in the top 10, at Nos. 4 and 7, respectively.
Texas, as a whole, is one of the few economies that's performing extremely well because of the energy and technology sectors," says Andrew Gledhill, an economist at Moody's Economy.com. Plus, he added, military bases in San Antonio have continued to draw a steady steam of personnel and federal employees to the city, spurring widespread job growth.
The state's manufacturing sector has also grown in recent years, and a reputation for affordable housing continues to lure people to the South. When accounting for median household income, a house in Dallas, for example--with a median price of about $150,000--is four times more affordable than a house in Los Angeles, the worst-ranked city on our list.
A house in New York is three times less affordable than in Charlotte, N.C., and four times less than in Denver, two cities where your money goes far and where the median house costs $245,000, according to the National Association of Realtors.
Housing has remained affordable in the South and Midwest, thanks to growing populations, relatively lax building regulations and "lots and lots of land," said Daniel McCue, a research analyst at Harvard's Joint Center for Housing Studies.
Plus, he added, housing in cities like Houston "grew at a more controlled pace and didn't go overboard like in Phoenix or Las Vegas," which means houses won't lose much value in coming months.
Three Midwestern cities round out the top 10: Indianapolis; Columbus, Ohio; and Minneapolis. The worst-ranked cities, after Los Angeles, were Providence, R.I.; New Orleans; Philadelphia; and Cleveland.
Behind the Numbers
To ensure that our list reflected future value instead of past bargains, we began by looking at projected job growth through 2012 in the 40 largest U.S.-Census-defined metropolitan areas of the country with data from Moody's Economy.com.
Texan cities were a clear winner, with economists predicting job growth of at least 2% by 2012 in Austin, San Antonio, Dallas and Houston. By comparison, job growth in cities at the bottom of our list, including Los Angeles, Philadelphia and Cleveland, is expected to be about 0.2%.
We then calculated the ratios between each city's median house price and median household income, using 2000 U.S. Census figures, the latest available, and 2007 data from the National Association of Realtors. Next, we compared median income to Moody's cost of living index.
Final factors included the average gas price in each city on a given day in October as collected by AAA, and year-over-year inflation growth as calculated by Moody's and Forbes.com.
Top Spots
The factors that make the cities on our list valuable--affordable housing, relatively low gas prices, sluggish inflation, a job market that's more vibrant than most--are more than an indication of cheap deals. Instead, they give us a glimpse of the cities that are likely to offer value. Cities like Detroit (which didn't make it to our list) are cheap, but low-income figures and a fading job market won't do much for sustaining worth.
The cities where you'll get the least value include areas like Los Angeles, New York and Washington, D.C., where median house prices are more than $400,000 and relatively few people can afford them. Cities like Providence, R.I., and Philadelphia are suffering from large waves of out-migration as more and more residents decide to pick up and leave. As a result, local economies stagnate, and prospects for job growth seem bleak--economists predict the number of jobs in Philadelphia will grow by 0.2% by 2012 and by 0.1% in Providence.
But, economists say, no state has been as hard hit as California.
"California is being faced with a combination of a zillion things--the state's been in a prolonged recession, and at the same time, you have some of the least affordable housing in the country,” says Gledhill. "We'll probably start seeing a bottom in the housing market late next year, but it'll be a while until we see a real recovery."
Los Angeles' misfortunes, however, have helped boost the economy in cities like Portland, Ore. It and Seattle have become attractive alternatives for those looking to leave California in search of affordable housing and lower costs of living.
The value of a dollar in different cities is also closely linked to local inflation rates. In Austin, for example, year-over-year inflation rates rose by 5%, while in Portland, that figure was nearly 5.7%. Local inflation rates ranged from 3.2% in St. Louis (No. 8 on the worst list) to 5.82% in Dallas (No. 7 on the best list).
But keep in mind, even cities that ranked well on our list aren't immune from the forces of today's downturn. Gledhill says economic growth in Portland, which has already begun to slow, will be compounded further by California's slowdown.
Things won't be much better in Columbus, according to Bodhi Ganguli, an economist at Moody's. So far, the city has weathered the storm better than its local counterparts. But he said, "an extremely high foreclosure rate" and bleak expectations for job growth will begin to take their toll on the city's economy.
Things may turn for those in Charlotte, which has fared relatively well so far. That's because housing prices never reached exorbitant highs, which shielded the city from a major housing bust.
But as the Charlotte-based Wachovia (nyse: WB - news - people ) get swallowed by Wells Fargo (nyse: WFC - news - people ), Gledhill says, "a more measured deterioration is on its way."
10. Portland, OR (there you go, TlongII)
9. Denver, CO
8. Minneapolis/St. Paul, MN
7. Dallas, TX
6. Columbus, OH
5. Charlotte, NC
4. Houston, TX
3. Indianapolis, IN
2. San Antonio, TX
1. Austin, TX
Nice find CMG.
Hush, don't tell anyone!
I think I liked it better when everyone still thought that we Texans still rode horses to get to work, didn't have paved roads, and had to get our water out of a well with a bucket.
We need to close down our borders and not allow anyone to move here from CA or the Northeast in order to keep our home prices low.
From what I've seen traveling in the US, I'm not surprised. LA right now is pretty horrible.
ATX baby. Reppin my block .
austin!!!!!!!!!!
austin, becoming the condo capital of the world. who's gonna live in all those things?
great. Like we need any more transplants coming in, buying up 'cheap' real estate and driving the values on up.
apparently the richers.
yeah i heard they haven't even addressed the problem of the city fire dept. not being equipped to handle the high rises ..... stupid richers
My co-workers sister goes to UT and was able to get one of those badass ones for super cheap, like 400 a months or something. They are practically giving them away.
The largest private employer in Austin, is not AMD or any high tech company.
It is Seton Medical. Numerous hospitals, an HMO, specialists, and facilities.
That is the kind of employment that will be recession-proof.
Add in UT of Austin, the state government, and you have a very stable economy.
I would imagine the high-tech sector there, Freescale, AMD, etc, will take some hits though.
Good question.
I would be intensely curious to see if they can actually sell all of them.
So what's California's answer to their budget crises and deficit?
"Raise business tax"
And they wonder why they can't attract businesses.
We just bought a house in Austin. I need someone to come in and buy houses to prop our value up.
San Antonio upgraded to highest level on Standard & Poor's Ratings Service rating bonds.
http://sanantonio.bizjournals.com/sa...3/daily23.html
Wednesday, October 15, 2008 - 11:21 AM
City of San Antonio gets credit-rating bump
There is some good news for San Antonio during these tough economic times.
San Antonio Mayor Phil Hardberger says Standard and Poor’s Ratings Service has upgraded San Antonio’s general obligation bond rating to the highest level possible.
According to city officials, the Alamo City’s bond rating has been upgraded from AA+ to AAA. It is the first time that San Antonio has achieved such a rating.
“This is great news for San Antonio and proof positive that we’re doing things right in our city,” Hardberger says. “The outstanding leadership we have in City Manager Sheryl Sculley has allowed us to thrive despite problems in the national economy.”
Standard & Poor’s has cited the city’s “maintenance of strong financial reserves and continued diversification of the local economy” as primary reasons for its improved rating.
“I am very pleased with the upgrade by Standard & Poor’s to AAA,” Sculley says. “It reflects our diverse local economy and our commitment to strong financial management.”
Municipal bond ratings are issued by three major services: Standard and Poor’s, Moody’s Investors Service and Fitch Ratings. San Antonio’s general obligation rating by Moody’s and by Fitch is Aa1 and AA+, respectively.
City officials say these are also strong ratings.
City officials say San Antonio joins Phoenix as the only other market with a population of a million or more people to be rated AAA by Standard & Poor’s.
Hardberger says local leaders have long known that San Antonio’s diverse economy gives it a real advantage over other areas of the country.
“This really reinforces what we’ve known all along, and we’re proud to be recognized for it,” Hardberger says.
SA's Healthcare and biomedical sector had a 16 billion dollar impact in 2007 for San Antonio, growing by 1 billion from the previous year, similar to SA's financial sector.
There's five large hospitals under construction as we speak. Three in Westover Hills, one in Stone Oak and one on the southeast side. Plus lots of stuff being built in the Medical Center and the Stone Oak Medical Center, like the aforementioned hospital.
Plus, there's the military investing nearly 3 billion dollars into the city in new developments and moving in 12,500 people to the city over the next couple of years.
Then you have the 13 mile expansion of the San Antonio River including the extension of the Riverwalk to the north up to the Pearl Brewery.
Also, the Texas A&M-San Antonio on the far south side.
It's looking great for SA.
Last edited by Buddy Holly; 10-16-2008 at 12:35 AM.
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