More than a dozen housing markets in the United States are at higher risk of decline compared to other areas in the nation, largely due to housing affordability issues and underwater mortgages.
That is according to a recent report from ATTOM, a provider of property data and analytics. The website analyzed US housing markets based on home affordability, foreclosures, mortgages, and unemployment rates.
Each housing market is then ranked based on the said factors and given a composite score. Those with the lowest scores in the ATTOM report are deemed most at risk of a decline.
Which Region Had the Most Vulnerable Housing Markets?
The most vulnerable housing markets were found in clusters, particularly around Chicago, New York City, and inland California. In total, those areas had 24 of the 50 housing markets considered most vulnerable in this year's third quarter.
Of all counties, those considered most at-risk included:
- Cook
- Kane
- Kendall
- McHenry
- Will
- Lake County
- Kings County
- New York County
- Essex
- Passaic
- Sussex
Another 13 counties considered at risk were in California, including Butte County, Contra Costa County, El Dorado County, Humboldt County, Solano County, Kern County, Kings County, Madera County, Merced County, San Joaquin County, and Stanisland County.
In these housing markets, housing prices have skyrocketed in recent years. However, wages did not grow at the same pace, per Norada Real Estate. This has made homeownership increasingly unaffordable. Furthermore, these areas had higher rates of underwater mortgages and foreclosures than other parts of the country
Where Are Housing Markets Least Vulnerable?
Of all regions in the US, the South had the least number of housing markets that were vulnerable to declines. The South had 22 of the 50 counties that were least vulnerable to a housing decline.
In comparison, the Midwest had 13 least vulnerable markets, while the Northeast had 11, and the West had just four.
Of all states, Tennessee had eight of the least at-risk counties in this year's third quarter. Specifically, these counties were Rutherford, Blount, Knox, Hamilton, Bradley, Sullivan, and Washington.
In many of these counties, residents needed the lowest portions of wages for homeownership and only a small percentage of residential mortgages were underwater.
