(REALTOR.COM) Everyone loves a great comeback story.
And there are plenty to go around. Rocky. Steve Jobs. The Chicago Cubs. Jesus. Lil Bub (Google her!). And, with apologies to Jesus, perhaps the most impressive comeback of all, the one that hits us exactly where we live: the housing industry.
After all, the 2007 real estate crash was a trauma that cut a wide swath of destruction through the ranks of home buyers, sellers and owners—and just about everyone affected by the bleak recession that followed. Although it has taken several agonizing years, the housing market is finally looking good again in much of America. A classic comeback! Cue the Rocky theme ....
But wait, there's a twist to this tale: The path to housing recovery has not run smoothly across the United States. Some cities have rebuilt and recovered. Some are back even stronger than they were in their heady, pre-crash salad days. And yet others continue to flounder, plagued by swaths of bank-owned homes.
The median home price bounded back to $227,000 nationally last year, already higher than the market peak of $220,400 back in 2005. Compared to the rock-bottom level in 2011, home prices have improved by 26%. (Adjusted for inflation, the current prices have recouped about 80% of their peak value.)
"Nationally, median home prices have more than fully recovered," says Joe Kirchner, senior economist at realtor.com®. "But at the local level, some markets have not yet followed suit."
The post-crash haves and have-nots
So the data team at realtor.com® decided to figure out which parts of the country have recovered the best from the housing bust: the true comeback kids! We took the150 biggest metros around the country, factored in their highest, pre-recession home-price heights, their lowest lows of the crash—and which ones rebounded best through 2016. We measured the recovery by measuring home prices, the amount of new home construction, foreclosure and unemployment rates and the household income of local residents in 2016.
(Metropolitan statistical areas, as defined by the federal Office of Management and Budget, are highly populated, geographical areas made up of one or more city cores surrounded by suburban and rural communities closely tied to that core.)
To ensure a fair comparison, we excluded markets that didn't experience much hardship. After all, to compare the recovery in Austin, TX (which barely had a blip), with Las Vegas (famously choked by foreclosures), would be comparing apples to oranges—or maybe Craisins.
So what did we find? The cities that achieved some of the speediest and most definitive recoveries have been the knowledge hubs—places clogged with colleges, research centers and young brainiacs, where a nimble, educated workforce helped attract new businesses. And cities that have done a good job diversifying their economy have also been big real estate winners in the past decade.
Take a look at who made the top 10:
- San Jose, CA
- San Francisco, CA
- Portland, OR
- Grand Rapids, MI
- Provo, UT
- Colorado Springs, CO
- North Port, FL
- Charlotte, NC
- Boise, ID
- Reno, NV