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Report Says Bay Area Is 6th-Riskiest Home Market Through 2010

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By SHANNON BEHNKEN | The Tampa Tribune

Published: July 9, 2008

TAMPA - The Bay area is the sixth-riskiest market in the nation for home prices to fall in the next two years, according to a report from PMI Mortgage Insurance Co.

There is an 86.69 percent chance that home prices in the Tampa area will be lower in 2010 than they are today, according to PMI's quarterly U.S. Market Risk Index.

The company bases the index on home-price data, labor market statistics, housing affordability, household income, past trends in price appreciation, and mortgage rates. Sixteen of the nation's 50 largest metro areas have a 40 percent or greater chance that prices will fall, according to the report.

Of those markets, six are in Florida.

PMI's top five riskiest markets for falling home prices nationwide are:

•Riverside-San Bernardino-Ontario, Calif., 95.5 percent;

•Fort Lauderdale-Pompano Beach-Deerfield Beach, 92.2 percent;

•West Palm Beach-Boca Raton-Boynton Beach, 91.9 percent;

•Orlando-Kissimmee, 91.1 percent;

•And Las Vegas-Paradise, Nev., 88.1 percent.

Other Florida markets with a greater than 40 percent risk are Miami with 84.8 percent and Jacksonville with 73.2 percent.

In general, risk is expected to intensify in areas where home prices increased significantly during the housing boom, according to the report.

In the Tampa-St. Petersburg-Clearwater metro area, home prices have been falling since January 2007, according to the Florida Association of Realtors. The median sale price for a single-family home in the area was $176,100 in May. The median is the middle number in a list showing lowest value to highest.

Bay area prices peaked in August 2006 at a median sale price of $237,800.

Reporter Shannon Behnken can be reached at (813) 259-7804 or sbehnken@tampatrib.com.

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