Raleigh is the Nation’s 5th Most Stable Real Estate Market

Article by Sarah Chaney as printed in the Triangle Business Journal July 1,2014

Buying and selling real estate has been a rocky road for homeowners across the nation, but Raleigh’s market has proven one of the strongest in the nation, according to recent research.

Because so much wealth is tied to real estate, the state of the market is important for local homeowners. To further explore this element of importance, Bloomberg teamed up with real estate website Zillow.com to study which of the nation’s 50 largest housing markets have been the riskiest over the past 35 years — and they determined Raleigh is the fifth most stable market in the U.S..

The first criterion in the study was buyers’ chance of suffering loss, given they held on to their homes for five years before selling. As a secondary criterion, Zillow.com compared the worst annual losses homeowners these markets have experienced since 1979.

Raleigh’s worst year was from July 1981 to July 1982, when its average home prices dipped to below 5 percent. Its risk of loss was 9 percent.

Buffalo, New York was the stablest market with zero percent risk of loss, and Hartford, Connecticut was the riskiest market with 36.8 percent risk of loss.

As for methodology, for each of the 50 largest housing markets, Zillow.com analyzed average home prices over 117 rolling five-year periods since 1979. It defined the “risk of loss” as the percentage of those periods that created negative returns for homeowners. In the case of ties between markets, those with the bigger drop in their worst years were ranked as riskier.