Is Home Price Inequality a Good Thing?
Related Articles Print This Post Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Tagged with: Affordability Home Price Home Values Homeownership Homes HOUSING Inequality LendingTree Servicers Navigate the Post-Pandemic World 2 days ago The Best Markets For Residential Property Investors 2 days ago The Best Markets For Residential Property Investors 2 days ago Is Home Price Inequality a Good Thing? Data Provider Black Knight to Acquire Top of Mind 2 days ago Previous: BCFP Announces Director for Office of Innovation Next: Confirmation of Sale Scrutiny in Kansas About Author: Alison Rich With median-priced homes now getting too expensive for average households, tons of people are locked out of the market. Where is home price inequality the highest? LendingTree endeavored to answer that by analyzing house values in the 50 largest U.S. metros using a metric called the “GINI coefficient.” To provide a more tangible inequality measure, it included the values of the 5th and 95th percentile homes and their ratio, the company said. Which market dominates the most unequal category? The Midwest, while the West reigns supreme in the most equal category for home prices, the analysis found.The cities with the highest home price inequality: Detroit; Birmingham, Alabama; and Indianapolis, which posted an inequality level twice that of the most equal markets, the analysis indicated. On the flip side, Salt Lake City; Portland, Oregon; and Denver had the least home price inequality. Quantitatively, the analysis found that 95th percentile of home values were three times the value of the 5th percentile in these three areas, compared with more than ten times the value in the most unequal markets. Believe it or not, high home prices don’t necessarily equate to high inequality, the study found. For example, the San Jose and San Francisco metros—with the highest values for the 95th percentile of homes ($2.7 million and $2.3 million, respectively)—ranked No. 41 and No. 33 for inequality. Additionally, the metros with the most inequality tend to have very low prices for the 5th percentile of home values, the analysis reported. The most equal markets, however, were less affordable for borrowers with low incomes.After diving deep into the discovery process, LendingTree reached a conclusion that defies conventional wisdom about affordability.“Cities with more home value inequality have a wider distribution of home values, which means that families earning lower incomes may still have the opportunity to access homeownership in these cities,” it said. “The concurrent presence of high-value homes suggests that their economies are vibrant enough to support higher-earning jobs as well. Looked at in this manner, home value inequality could be beneficial.” Subscribe Affordability Home Price Home Values Homeownership Homes HOUSING Inequality LendingTree 2018-07-18 Alison Rich Share Save in Daily Dose, Featured, Market Studies, News Home / Daily Dose / Is Home Price Inequality a Good Thing? Data Provider Black Knight to Acquire Top of Mind 2 days ago The Week Ahead: Nearing the Forbearance Exit 2 days ago Demand Propels Home Prices Upward 2 days ago July 18, 2018 1,084 Views Servicers Navigate the Post-Pandemic World 2 days ago Alison Rich has a long-time tenure in the writing and editing realm, touting an impressive body of work that has been featured in local and national consumer and trade publications spanning industries and audiences. She has worked for DS News and MReport magazines—both in print and online—since they launched. Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Sign up for DS News Daily Demand Propels Home Prices Upward 2 days ago