America’s Cheapest Housing Market

By Douglas A. McIntyre Published Aug 28, 6:40AM EDT

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Recent analysis shows that home prices nationwide rose to a record high in June.
Detroit remains America’s cheapest housing market.
Also: Dividend legends to hold forever.

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index showed that home prices nationwide rose 5.4% in June compared to a year ago, reaching a record high. The figures did raise the question of whether homes are a good investment. Brian D. Luke, CFA, Head of Commodities, Real & Digital Assets, said, “Before accounting for inflation, home prices have risen over 1,100 percent since 1974, but have slightly more than doubled (111%) after accounting for inflation.” In at least one metro market, the answer to whether home prices have surged is “no.”

Case-Shiller took the 20 large cities it covers and gave each an index of 100 in January 2000. This allowed the researchers to see how much prices rose in each housing market compared to the others. For example, the city with the highest index in June was 449.24, which means it is the city in which prices have risen the most over the period. The national index for June was 325.23.

The city in which the index has risen the least since January 2000 is Detroit. Its index was only 190.47 in June. In other words, prices have not even doubled over the period. On an inflation-adjusted basis, it has fallen sharply.

Detroit may be the most impoverished large city in America. According to the Census Bureau, its poverty rate is 33.8%. Its population was 951,270 in 2000 and 633,28 last year. Based on these problems, Detroit’s index will not improve compared to the rest of the cities measured by Case-Shiller.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.