The subprime mortgage meltdown has spread across the country, but as the extent of the damage unfolds, a look at the trouble shows that its effects aren’t uniform.
For The Real Deal’s first National Market Report, we’ve created snapshots of the country’s 10 busiest real estate markets. The supplement brings the same in-depth coverage The Real Deal is known for in New York and Miami, and will help serve the many brokers, investors, developers, attorneys and other real estate professionals who have a hand in business in multiple cities across the nation.
While some cities are hurting, the overall market is diverse, uneven and attuned to regional developments.
Big cities have generally been building fast in recent years, but some have been faring better than others. Experts say the fallout from the subprime debacle could have an even greater effect on already weak markets.
No place in the country has seen a sharper drop in building permits than Phoenix, where stagnant home prices have put homeowners in a bind.
In Houston, too, low prices aren’t keeping homeowners out of trouble. The city, where the median home value is $160,000 (a full $70,000 less than the national median), is feeling the pain, particularly in lower-middle-class neighborhoods. Foreclosures and a steady supply of newly built units in the nation’s second-fastest-growing city have been pushing prices down.
Older central cities and downtown areas less susceptible to sprawl-style development appear to be faring better.
Extensive efforts to revitalize a downtrodden part of Market Street in San Francisco are gaining momentum, and the thoroughfare is poised for the start of the city’s biggest residential project in the last 50 years.
Chicago’s apartment building sales have gained on the suburbs’, with record sales downtown. Even Atlanta, one of the nation’s sprawl capitals, is home to a downtown condo boom, reversing population declines in the central city.
Still, Las Vegas’ attempt to build up its downtown with new condo towers hasn’t gone as smoothly. Only 27 percent of the condo units planned since 2004 for the city are already built, under construction or pre-sold.
Las Vegas, in fact, may prove a cautionary tale as the national market as a whole looks set for considerable turbulence. What is today’s local story could be tomorrow’s national story.
Atlanta: City migration fuels condo building boom
Boston: Boom times for office space
Chicago: Apartment building sales headed for record year
Las Vegas: The house always wins
Los Angeles: Investment by Chinese accelerates
Houston: Foreclosures level off, but city not in the clear
Miami: More construction in store
Phoenix: A steamy market cools off