Chicago suburbs. There are for sale signs EVERYWHERE. Stuff is not moving. So many deals get ruined with contingencies cuz no one can sell their house. Its snowballing. Ask any Real Estate agent... they have tons of listings, but no buyers. Im thankful that my home is a starter home in the midwest. If I can sell, I'll be in SoCal to pick up the pieces. If its this slow in midwest, SD, Vegas, Phoenix, and Miami are in for a big hurtin.
Gotta laugh. Two fabled Wisconsin beers duking it out. I'm Chicago born and raised but I'm living outside Miami virtually full time. I know the market well in both areas. Chicago is about as expensive as SoFla. The subtlety in comparisons like these is the ability to identify "like" neighborhoods. There's ultra-expensive stuff in both areas, there's ghetto's in both areas. While I'm bearish on South Florida prices I'm even more bearish in the long haul on Chicago. IMO, theres a permanent demographic shift that's transforming the wealth, jobs and lifestyle to the Sun Belt. The hot areas you mention are all over-developed with resales trading at obscene premiums to rents. I'll grant you that in Chicago rents are stable and P/E's reasonable. In the SunBelt P/E's are ridiculous. I saw a listing for a penthouse in a oceanfront condo in Daytona for $1400 a month. The place is BLOWN GORGEOUS and listed for sale at over 600k. If the place can only rent out for $1400 then it's "value" may wind up at 300 or less. However I see a trend that's going to make North Carolina a new power center and warm, low tax states like Florida, Nevada and Texas perennial population increase champs. Buying a healthy break in the South will pay dividends. Chicago, Milwaukee, Pittsburgh, Buffalo, Cleveland, Detroit are all being left out in the cold, no pun intended.
I think it has to do with some other factors too - 1. All these cities are in 'blue' states with heavy social programs - i.e. high taxes 2. Old, 30's era anticompetitive laws abound in these areas which further hamper their chances of economic revival. 3. There exists a great deal of aging infrastructure which has not been maintained due to patronage. The south is just developing its infrastructure & has few such problems. 4. Give it 20-40 years; plus global warming, and these cities might be screaming buys. Until then, good luck!
From the CEO of the largest homebuilder: "Then, Tomnitz said, "June absolutely fell off the Richter scale for us." I have heard from pros all over that buying interest collapsed that month. If anything remotely close to this level of violence had taken place in financial markets -- it would be the business story of the year. 29% of Horton's buyers walked away in June -- a level way, way above what followed the WTC attacks from what I know. IMO we will trace the bubble pop start to June 06 as well as the start of a US recession. The reason I say this is data the fed gets from its regions on housing has to show this. Just as important, psychological and sentiment factors went abyssmal. This negativity is a far different bird than what traders/investors might be inclined to use as market buy signals. It's dangerous. Real estate does not climb walls of worry. Big, long lasting shakeout coming all across real estate related enterprise.