The PMI Group released their U.S. Market Risk Index and it showed that the risk of falling real estate markets was offset by the strength of the economy. They use the OFHEO Home Price Index to measure appreciation patterns and track affordability.
Here are the salient points:
- Appreciation remains positive in the nation’s 50 largest markets.
- 34 markets experienced reduced appreciation rates.
- Affordability decreased in more than half of the 50 markets.
- All but 4 markets showed employment growth. (Detroit and Warren, MI; Milwaukee, WI; Cleveland, OH did not).
- The coasts are most risky – California and Northeast have 13 highest risk markets.
- West coast has highest appreciation.
- Affordability improved in 5 markets in Texas and 6 in Midwest.
There’s also a great table in the report that provides the best and worst senarios for mortgage payments.