To find this story, I went from a post on the P-I RE Professionals blog, to an Inman blog post, to a Google News search, where I finally located a substantial story. I'll admit that I've never heard of John Burns Real Estate Consulting, and considering the relative lack of coverage of their most recent study, I'm assuming they're not exactly a big name in the industry. That being said, the study is at least worth mentioning. According to Mr. Burns' Housing Cycle Barometer, Seattle is one of the top ten bubble markets in the country.
According to a just-released study by John Burns Real Estate Consulting, one of the preeminent researchers in the field, of the 100 largest metropolitan areas (based on annual permit activity):Excellent. But don't you worry your little head, because wages will catch up, our education will save us, and our job market is invincible. There's no bubble here... there can't be.
- 13 markets are below their historical median affordability level
- 3 are exactly at their median
- 84 are above the median.
Nine markets have even worse affordability levels than when mortgage rates were 18 percent+ in the early 1980s: New York, Washington, D.C., Los Angeles, Seattle, Portland (Oregon), Baltimore, Edison (New Jersey), Nassau (New York) and Naples, Fla.
Burns' methodology compares current affordability in each market to historic affordability in the market to determine whether housing is more or less expensive in the market than in price downturns.
(Jason Knott, CEPro, 08.31.2006)
(John Burns, John Burns Real Estate Consulting, 08.31.2006)