A rush of investment in Sun Belt cities propelled the infamous housing bubble and bust of the 2008 financial crisis, but Texas was surprisingly spared from the housing bubble meltdown over a decade ago. Now, the Lone Star state is at the forefront of an affordability crisis hurting prospective homebuyers nationwide. According to a recent measurement of regional housing markets conducted by Florida Atlantic University, Austin is the second most overvalued metro in the nation with a median home price of $589,600, Fortune reports.
Throughout the pandemic, California-based Fortune 500 companies relocated to Texas cities for more favorable tax rates, but that influx of newcomers fueled a statewide home price acceleration that is now proving to be unsustainable for a growing number of locals.
According to the Florida Atlantic University researchers, Dallas is "overvalued" by 46%, ranking it No. 18 in the nation. Not too far behind are San Antonio ("overvalued" by 30%) and Houston ("overvalued" by 28%). So what's going on?
Just two years ago, Florida Atlantic University rated Austin and Dallas as only "overvalued" by 4% and 10%, respectively. The dramatic price inflation since then speaks to the unprecedented nature of the ongoing housing boom. The heated Texan markets also have more folks in the real estate industry particularly concerned about Austin.
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