Cincinnati: there was never a real estate bubble to burst
Tuesday, May 29th, 2007It’s a buyer’s market here in Cincinnati, Ohio. Much like other major metropolitan areas throughout the U.S., the current supply of homes on the market is exceeding the number of sellers. If you listen to the radio, watch tv, or pick up a newspaper you continually hear reports that the real estate market is in a tailspin, a downturn, or even the dreaded words that every seller hates to hear “a bubble burst”.
The problem with this commentary is that the news agencies have taken localized data from all over the U.S. and aggregated it, so they produce headlines that can be sold at news stands across the country (such as the Wall Street Journal, New York Times, or published on the web like on CNN.com or Yahoo! etc).
Here in Cincinnati prices have come down slightly, and there is an increase in the number of homes on the market. But you simply can’t compare the “slowdown” of Cincinnati, Ohio to the likes of Las Vegas, or Miami, FL, or numerous parts of California. We simply did not have the huge increases in prices over the past few years that these areas had. Therefore, while some areas of the country were increasing at 25% or more, Cincinnati was a more modest 3-8% depending upon the particular area of the Cincinnati metro area that you examined.
Similar to our home prices not expanding rapidly, the sales prices have not come down rapidly either. And furthermore the Cincinnati area is not over built as some metro areas, so the “glut” of homes is not severe. The supply and demand are more level in Cincinnati.
My last few blogs have focused on investing in the stock market. This blog begins a series of posts examining our local real estate market (Cincinnati and Dayton, Ohio) and comparing the statistics here with those national headlines you read about in the national newspapers or see on cable tv. I will also try to add posts that mix in valuable tools and ideas for anyone who is interested in the local market or considering buying or selling in the near future.
As always, I welcome your feedback…
