This morning I was reading a post by Dorene Shirley that linked to an article that is currently on Forbes.com titled,
"America's Riskiest Real Estate Markets". When I clicked on the link to read the article there was a picture of some directional arrows in front of some new construction homes. I started to click on the article when I noticed that one of the names on the directional arrow sign belonged to a company here in St. Louis.
I was throughly surprised to see St. Louis included on this list, more or less coming in at being the fourth riskiest real estate market!
I'll fess up, things have been rough here. A home that I sold in three days for $178,000 where the deal didn't close ended up selling for $160,000 eight months later. This was almost a year ago and I happened to be showing property in that same subdivision last week and saw where similar homes to the one that I sold were still selling in that $160,000 range. To me, this is pretty indicative that the market had truly dropped around 10% from it's highs.
I also wrote a contract on a foreclosure that was priced fairly aggressively and ended up losing out to a higher bid in what turned out to be a multiple offer situation. This home was discounted, but if you took into account the deferred maintenance, it wasn't discounted all that much!
Anyway, this got me to wondering how much thought went into this article. Was it something that some free lance writer threw together in order to generate a paycheck?
From a boots on the ground perspective, I honestly don't think that the St. Louis real estate market is THAT bad. It's bad, but I don't see any way on earth that it would be the fourth riskiest in the nation!
I also think that the St. Louis real estate market actually has quite a bit going for it. St. Louis has a very diversified economic base. While we still have a fair amount of old school industry, such as auto and aerospace manufacturing (pretty wild to consider aerospace manufacturing as being old school, huh?), it also has quite a bit of new age stuff going on as well. Biotech would be an example of this.
St. Louis is also benefiting from it's relatively low cost of living compared to other major US cities. In the past year or two I've worked with several people who are relocating to St. Louis from more expensive markets such as Chicago, New York and Boston. Without exception these folks told me that one of the reasons that they were moving was because they could get a job here that pays almost as much as their previous jobs, but that here they could afford to buy a nice home.
So, all things considered, I don't think that the St. Louis real estate market is all that risky! And this brings me back to my question on how much thought went into this article? Did your market make it to the list? If so, what is your take on it?
Let me know!
R. B. "Bob" Mitchell
ValueList Real Estate Services, Inc.
Bob Mitchell is president of ValueList Real Estate Services, St. Louis' largest discount/full-service real estate and mortgage company. If you would like to find out more about Bob, ValueList or our flat-fee listing program, please feel free to visit our web site at valuelistre.com
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