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From msn.com:

It’s been a roller-coaster year in real estate, with sales plunging and prices dipping. It’s enough to leave most buyers too scared and queasy to act.  But the outlook isn’t the same for everyone. Some markets have hit bottom and are trending up, making it a good time for buyers to pull the trigger. In other markets, well — better luck in 2012.

We asked the folks at Local Market Monitor to share their predictions for the five best and worst markets for those who are ready to buy now. LMM analyzes more than 300 housing markets and identifies markets that are “suitable for investment” or “dangerous.”

The 5 worst markets
While the U.S. overall is expected to see a 1% drop in home prices next year, according to LMM, these markets — with a population of 400,000 or more — should fare worst. (Hint: It’s looking like dark times for the Sunshine State.)

  1. Deltona-Daytona Beach-Ormond Beach, Fla.: The average home price is predicted to drop a whopping 11% over the next year from the average actual home price of $146,234 at the end of the third quarter.
  2. Lakeland-Winter Haven, Fla.: A 7% decline from the average actual home price of $139,734.
  3. Orlando-Kissimmee, Fla.: A 7% decline from the average actual home price of $180,900.
  4. Boise-Nampa, Idaho: A 7% drop from the $162,016 average at the end of the third quarter.
  5. Reno-Sparks, Nev.: Down 7% from $188,286.

The 5 best markets
And which areas did LMM pinpoint as having the best prospects for buyers in 2011? (Don’t get too excited. The good news here isn’t great, but it’s better than the alternative.) 

  1. San Diego-Carlsbad-San Marcos, Calif.: The average price in this boom-and-bust market is predicted to increase 1% over the next year from the average actual home price of $336,679 at the end of the third quarter.
  2. Oklahoma City: Homeowners here will be OK, with an increase of 1% in 2011, from an average of $156,948.
  3. Tulsa, Okla.: No risk here: Prices will stay flat next year at $151,384.
  4. Cincinnati-Middletown, Ohio-Ky.-Ind.: Ditto for this area: Prices will remain flat, at $175,347.
  5. Lexington-Fayette, Ky.: This is a market at bottom: Prices here will decline about 1% from the average actual home price $183,084.

What? A decline passes for good news? I guess it does in today’s dismal market. There were also signs of easing in some of the nation’s most distressed markets, including Phoenix, Atlanta, Chicago, Detroit and Minneapolis. LMM expects prices in those cities to dip more modestly next year than it had predicted just one quarter ago. 

So raise a glass and toast the end of the worst — or if you’re in Daytona Beach, just drink enough spiked eggnog that you forget about real estate altogether.

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