Worcester Ranks as One of Worst Real Estate Markets in U.S.

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Wednesday, August 31, 2016

GoLocalWorcester News Team

Worcester is ranked 251st for real estate in the U.S., according to a study done by WalletHub. 

"Citing U.S. Census Bureau data, the New York Times recently reported that sales of new single-family homes were higher this past July than in nearly 10 years. Nationwide, which tracks the health of U.S. real estate, reported at the end of quarter two that “the overall U.S. housing market is sustainable,” adding that “few regional housing markets are vulnerable to a housing downturn," said WalletHub. 

Worcester is ranked 252nd for real estate market and 167th in affordability and economic  environment rank. 

The Rankings 

Worcster is ranked 251st behind Pompano Beach, Florida and Milwaukee, Wisconsin at 249 and 250, while ranking ahead of Las Vegas, Nevada and Buffalo, New York at 252 and 253 respectively.  

Newark, New Jersey is listed as the worst city for real estate, while Frisco, Texas is listed as the best city. 

For complete rankings, see the map below. 

The Method 

WalletHub’s analysts compared 300 cities across two  dimensions, “Real-Estate Market” and “Affordability & Economic Environment.” They evaluated the categories using 16 relevant metrics. Each metric was graded on a 100-point scale, with 100 representing the healthiest housing market.

WalletHub then calculated overall scores for each city using the weighted average across all metrics, which they used to construct the final ranking.

 WalletHub categorized the cities based on the following population sizes:

• Large cities: More than 300,000 people
• Midsize cities: 150,000 to 300,000 people
• Small cities: Fewer than 150,000 people

Real-Estate Market – Total Points: 80

• Percentage of Homes Underwater: Full Weight (~7.27 Points)
• Note: This metric measures the percentage of homes with negative equity.
• Average Number of Days Until a House Is Sold: Full Weight (~7.27 Points)
• Percentage of Homes Selling for a Gain: Full Weight (~7.27 Points)
• Median Home-Price Appreciation: Full Weight (~7.27 Points)
• Home Sales Turnover Rate: Full Weight (~7.27 Points)
• Rent-to-Sale Price Ratio: Full Weight (~7.27 Points)
• Foreclosure Rate: Full Weight (~7.27 Points)
• Mortgage Delinquency Rate: Full Weight (~7.27 Points)
• Note: This metric measures the percentage of home owners who are delinquent on their mortgages.
• Number of Bank-Held Homes: Full Weight (~7.27 Points)
• Note: This metric refers to unsold Real Estate Owned, or REO, housing units.
• Vacancy Rate: Full Weight (~7.27 Points)
• Note: This metric was calculated by dividing the number of vacant housing units by the total number of housing units.
• Building-Permit Activity: Full Weight (~7.27 Points)
• Note: This metric measures the number of unit permits pulled per 1,000 residents.

Affordability & Economic Environment – Total Points: 20

• Housing Affordability: Double Weight (~6.67 Points)
• Note: This metric measures home price as a percentage of income.
• Maintenance Affordability: Full Weight (~3.33 Points)
• Note: This metric measures maintenance costs as a percentage of income.
• Population Growth Rate: Full Weight (~3.33 Points)
• Job Growth Rate: Full Weight (~3.33 Points)
• Unemployment Rate: Full Weight (~3.33 Points)

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