What do people think about realtor.com's recent top 10?

Question

Hey all,

The news that St Louis, Missouri is the #2 hot market according to Realtor.com has been generating a lot of buzz - my investor clients and other people working in RE keep telling me they're seeing the news all over social media.

http://www.riverfronttimes.com/newsblog/2015/12/02...

I'd be curious to hear other investors' perspective on realtor.com's top 10

http://www.realtor.com/news/trends/top-10-real-est...

I've been watching the trends for things like Days on Market for a while now so this didn't exactly come as a surprise, and personally I don't see it changing my investment strategy as a buy-and-hold investor.  As a real estate agent I try to discuss a lot of metrics (DOM, %list price, number of expired/withdrawns) at the regional as well as neighborhood or block level, so I hope my clients take this as another piece of information to consider when investing.  But, I  could also see this appealing to some investors, especially out of state investors trying to find a market.  Alternatively, I could see people concerned about inflated prices backing off from these markets.

I've got some definite opinions (St Louis is very block by block and there are still a lot of opportunities out there) but I'd be interested in hearing other's thoughts.

Thanks in advance.

Maggie

Phillip Davis · Answer

I completely agree with Maggie. I just bought my first duplex in the city, and I was sweating bullets because a few block in either direction can make a difference -- and I grew up in the St. Louis area!  Some neighborhoods are perfectly priced others are just a bit too expensive and some class C's are cheek by jowl with great neighborhoods. This seems to be one area where local knowledge is really needed!

Maggie L. · Answer

Some of the list makes sense, especially the exclusions of markets that are already relatively expensive.  I wouldn't claim to know much about the other markets, but when I talk to out of state investors considering St Louis they seem to be struck by how different it is here.  It's EXTREMELY block by block in the City, and one thing that comes up is how rapidly things change from block to block even in "destination neighborhoods" e.g. yard size, historic details, curb appeal, home size, commensurate ARV, rental rates.  Personally, I enjoy living somewhere that I can drive through a few neighborhoods and see the many architectural details that changed over the decades.  I appreciate that developers purposely mixed in single families and multi families of different sizes, but it can make comps a lot trickier.  St Louis County and other areas surrounding the city are also very different markets, so I'd be curious to see the parameters for their data and if St Louis stands out as a bit of an anomaly in that regard.

Abhi Golhar · Answer

@Maggie Lalor - when you have a moment, please get in touch. I'm working to expand and scale our business to include STL.

Chris Dawson · Answer

I grew up in St. Louis but I have been living in Kansas City for the past 20 years.  To me, the St. Louis market and the Kansas City market have always been fairly similar.  KC is smaller and always seems to be a little bit more mild when it comes to the fluctuations, but otherwise they are very similar.  I find it interesting that KC isn't mentioned at all since they are so similar.  I also wonder what the long term effects will be of the recent national attention SL has received for its racial tensions.

JD Martin · Answer

I can hardly see how San Diego or Boston can get much hotter than they already have been, in terms of home prices. Both markets are insanely unaffordable (BTW, why does this site flag "unaffordable" as a misspelled word?) for a significant portion of home buyers. Some of the others seem reasonable to me, though having been to (through) St. Louis recently, I can't say that is a market that makes a lot of sense to me. You can be in the middle of nowhere 15 minutes out in Illinois, which usually acts as a damper against runaway housing prices.

What do people think about realtor.com's recent top 10?

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