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NW homes make ‘overvalued’ list

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DEVONA WELLS; The News Tribune

Published: 06/05/08 1:00 am | Updated: 06/05/08 7:31 am

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A new real estate report ranks metropolitan areas by their level of statistical overvaluation, putting Tacoma at No. 27 with the value of a house, excluding condos, for the first quarter of the year pegged at $278,800. (Pierce County’s median home price in April, according to the Northwest Multiple Listing Service, was $263,051.)

While the ranking, which is out of 330 metro areas, seems high, the report says Tacoma falls into the category of “moderately overvalued” and “not so high as to be at risk of substantial price decline.”

Global Insight, which put together the report, labels Tacoma 24.5 percent overvalued. No. 1 was Atlantic City, N.J., at 55.6 percent overvalued.

Other Northwest markets didn’t fare as well. Anywhere over 35 percent, according to Global Insight, runs “a risk of substantial price declines” of 10 percent or greater.

Here’s a look at other Northwest markets, their rankings and by what percentage Global Insight considers each overvalued:

2. Bend, Ore. – 49.5 percent.

3. Longview – 40.2 percent.

4. Wenatchee – 40 percent.

6. Bellingham – 38 percent.

7. Portland – 36.2 percent.

11. Eugene, Ore. – 32.8 percent.

12. Medford, Ore. – 31.9 percent.

16. Salem, Ore. – 28.9 percent.

20. Olympia – 26.4 percent.

27. Tacoma – 24.5 percent.

28. Seattle – 22.8 percent.

Global Insight uses various factors to determine under- and overvaluation in each area, including median home price, household income, the density of households and mortgage rates.

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