Or so says listing site Trulia in a new study reported by AOL. Looking at both price-to-income and price-to-rent ratios for 100 cities across the country, the company found that, on average, home prices are 7 percent below where these metrics suggest they ought to be. But not in Orange County, the most overvalued place in the nation--prices there are 9.4 percent higher than they "should" be. Which sounds like a lot, until you remember that prices were 71 percent above market fundamentals at the 2006 peak. Oh but don't look so smug, LA: you come in at number four on Trulia's list, with prices 5 percent too high. In both cases, analysts point to the same familiar culprits of low inventory caused by underwater homeowners not wanting to sell, real estate investors, and improved job growth sparking more demand.
· 5 Most Overvalued Housing Markets in America [AOL]
· State O' The Market Archives [Curbed LA]