Home News 6 of the 10 U.S. housing markets most vulnerable to a downturn are in this state

6 of the 10 U.S. housing markets most vulnerable to a downturn are in this state

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Some real estate markets are more vulnerable to recession than others.

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Six of the ten most vulnerable counties to recession are in New Jersey, according to the Special Housing Risk Report, released by real estate ATTOM, which had the most concentrated markets in the first quarter of 2022. It is in. Data analysis company. ((((You can see here the lowest mortgage rates you might qualify for.).

Depending on the percentage of homes facing mortgages, the portion of the mortgage balance that exceeds the estimated real estate value, the percentage of average local wages required to pay the median single-family home ownership costs, and the municipality. The county is considered vulnerable. Unemployment rate. Rick Sharga, Executive Vice President of Market Intelligence at ATTOM, said: In the statement.

Most vulnerable to recession

Lowest vulnerability to recession

Passaic, NJ

Chittenden, Vermont

Essex, NJ

Benton, Arkansas

Atlantic, NJ

Davidson, Tennessee

Sussex, Delaware

King, Washington

Kent, Delaware

Shelby, Alabama

DeKalb, Illinois

Durham, North Carolina

Sussex, NJ

Tippecanoe, Indiana

Cumberland, NJ

Olmsted, Minnesota

Will, Illinois

Williamson, Tennessee

New Jersey Union

Rutherford, Tennessee

Sharga is much of New Jersey because the state “tends to be inherent in some risk factors, such as high prices, which means a higher percentage of household income is needed to maintain ownership.” The county is on this list, surrounded by the city of New York, and Philadelphia said, “The economy is pandemic-affected and is therefore spreading to New Jersey.” ..

New Jersey is not the only state with vulnerable counties. In fact, the report found that these three states contained 34 of the 50 counties most vulnerable to potential decline. And of the 50 most risky counties, eight are in Chicago’s metropolitan areas (Cook, DeKalb, Kane, Kendal, Lake, McHenry, Will) and six are near New York City in New Jersey (Bergen,). It was in Essex, Ocean). , Passaic, Sussex, Union in New Jersey) and 10 scattered throughout California (Butte, San Joaquin, Shasta, Solano, Fresno, Kings, Madera, Merced, Stanislaus, Kern).

“Since the rural areas of northern California and the areas around New York and Chicago don’t have much in common, the scatter of this place may seem geographically random, but due to the slow population growth, house prices are rising. Is slower than Sunbelt. ” Holden Lewis, a Nerd Wallet housing and mortgage expert. Jacob Channel, Senior Economist at Lending Tree, said: In these areas, you may need to increase your budget a bit more to afford a home. “(((You can see the lowest rates you might qualify here.).

This, coupled with uncertainties about how economies in these regions will work in the face of continued high inflation and a potential recession, could make the housing market more vulnerable than average. Means that there is. “Of course, given that other aspects of the economy, such as unemployment, are low, the housing market can be very strong even in areas with high housing prices. The housing market in one area is more vulnerable than in another. It’s important to remember that just because there are some indicators of potential, it doesn’t mean that the markets in those regions are on the verge of a major collapse. ” Says the channel.

The report states that key home ownership costs such as mortgage payments, property taxes and median home insurance are 30% of average local wages in 25 of the 50 counties most vulnerable to market problems. It is clear that the above has been consumed. The highest percentages in these markets are 48.9% of the average local wage required for major cost of ownership in San Joaquin County, California and 48.3% of the average local wage required in Bargain County, NJ. , 46.6% of average local wages in Solano County, California. Required for major ownership costs. Looking at it, the report suggests that the major national costs of typical homes sold in the first quarter of 2022 required 26.3% of average local wages. ((((You can see the lowest rates you might qualify here.).

So what does this all mean for the entire housing market, and for buyers in vulnerable counties?

The channel points out that the entire housing market does not appear to be at particularly high risk of collapse. “Currently, most data, such as low mortgage delinquency rates and record amounts held by homeowners, is a good place for the majority of homeowners across the country to keep up with payments. There is no serious risk of loan defaults, “says Channel.

However, if you are considering buying or selling in a vulnerable county, professionals say that price cuts could increase as homes and sellers are more willing to negotiate with buyers. “This can lead to a good deal for anyone looking to buy a home, but given how much prices have risen in many regions in 2020 and 2021, even if buyers have fallen. But you may still have to deal with high home prices, just a little bit, “says Channel.

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