Riskiest Housing Markets Cited in PMI Report

October 20, 2005, WSJ — Home prices in some of the nation’s largest markets are poised for a fall, according to a study that says homes are overvalued in many cities. The PMI U.S. Market Risk Index report, released yesterday, named Boston, San Diego, Long Island, N.Y., Santa Ana, Calif., and Oakland, Calif., as the markets facing the biggest risk of a price correction. The index showed these markets have a more than 50% chance of experiencing price declines during the next two years. New York City ranked 14th, with a 33% chance. Nationwide, there is a 21.8% chance that overall house prices across the 50 largest housing markets will see prices fall, up from 21.3% in the previous quarter. The markets with the lowest risk of a correction are Cincinnati, Memphis, Tenn., Indianapolis and Pittsburgh, where the risk is less than 6%.
Price Drop Forecast in Riskiest Markets [WSJ]