20 Housing Markets Overvalued by More Than 50%

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Homes in a neighborhood
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Housing markets across the U.S. have cooled lately. High mortgage rates have forced sellers in many areas to become a bit more flexible if they want to attract buyers.

However, anybody expecting to snatch up a bargain on a home still has a tough road ahead. The reality is that home prices remain in the stratosphere compared to where they were even two years ago.

In fact, in many markets, prices remain overvalued by more than 50%, according to the Beracha and Johnson Housing Market Ranking from Florida Atlantic University and Florida International University.


The ranking has identified 20 housing markets that are overvalued by at least 50%. Seven of those markets are overvalued by 60% or more.

Better news may be on the way for homebuyers in the coming months. After the Florida researchers analyzed housing market premiums — the percentage above the long-term pricing trends that people must pay in order to buy a property — they found that premiums fell in 12 markets during June.

In an FAU press release, Ken H. Johnson, an economist at FAU’s College of Business, says:

“Premium declines are an early warning sign that prices are leveling off and likely on the way back down. We will look back at this point as the starting gun for the down slope in our next housing cycle.”

Following are overheated markets that might be headed for some cooling soon.

20. Daytona Beach, Florida

1960s home in Daytona Beach, Florida
James R. Martin / Shutterstock.com

Premium buyers are paying in this market: 50.57%

Sun, sand and surf have drawn a steady stream of new residents — beach bums and other folks — to Florida in recent years. That has driven prices higher.

Florida is one of three states with multiple entries on this list.

19. Detroit

Home in Detroit Suburb
James R. Martin / Shutterstock.com

Premium buyers are paying in this market: 52.06%

Housing values in the Motor City have been chugging along, but it’s possible the wheels could come off soon. As we noted a couple of months ago, Detroit is among a handful of cities across the nation that showed the first signs of a dip in prices.

Recently, that trend has become more widespread nationwide.

18. Dallas-Fort Worth

Dallas, Texas Homes
Trong Nguyen / Shutterstock.com

Premium buyers are paying in this market: 52.25%

A Texas-sized run-up in home prices has left would-be homebuyers priced out of the market in Dallas-Fort Worth.

However, listings in this metro have surged recently, which should help ease pricing pressure here.

17. Melbourne, Florida

Melbourne, Florida
Stephen Wood / Shutterstock.com

Premium buyers are paying in this market: 52.77%

How fast have home prices risen in Florida? Early this year, Melbourne was deemed to be among “10 of the Most Undervalued Housing Markets in America.”

But as prices surged, the city soon moved from “undervalued” to “overvalued.”

16. Nashville, Tennessee

House in Nashville, Tennessee
eakkarat rangram / Shutterstock.com

Premium buyers are paying in this market: 52.95%

When it comes to home prices, the tune in Music City has been “Up, Up and Away.” But this city seems poised to see some of the hot air seep out of that beautiful balloon.

15. North Port-Sarasota-Bradenton, Florida

Sarasota, Florida
Sean Pavone / Shutterstock.com

Premium buyers are paying in this market: 55.04%

This is another Florida metro where home prices are the only thing hotter than the weather. That has left this market overvalued by 55%.

14. Salt Lake City

House in 1991
Matthew Thomas Allen / Shutterstock.com

Premium buyers are paying in this market: 56.07%

Salt Lake City is one of “12 Cities Where Home Values Have Jumped Over 40% Since the Pandemic Started.” Average prices here have shot up toward $600,000.

13. Spokane, Washington

Houses in Spokane, Washington
Kirk Fisher / Shutterstock.com

Premium buyers are paying in this market: 56.15%

Forget Seattle: Spokane has been Washington’s standard-bearer for overpriced housing these days. Recently, it made the list of “15 Cities Where Homebuyers Are Most Likely to Face Bidding Wars.”

But those days may be in the rearview mirror now.

12. Raleigh, North Carolina

Raleigh North Carolina home
KAD Photo / Shutterstock.com

Premium buyers are paying in this market: 56.29%

As we recently reported, Raleigh made the list of “10 Smaller Housing Markets That Are Now Red-Hot.” Will the heat continue to rise, or will the flames fall back to earth and burn Raleigh home prices to the ground?

As in so many markets across the country, buyers and sellers will have to wait to see how things play out.

11. Tampa, Florida

Tampa, Florida
picturin / Shutterstock.com

Premium buyers are paying in this market: 57.97%

During the pandemic, many people — including hordes of folks from New York and New Jersey — relocated to Florida. That has helped push prices in Tampa and elsewhere up to what might be unsustainable levels.

10. Lakeland, Florida

Lakeland, Florida
Sean Pavone / Shutterstock.com

Premium buyers are paying in this market: 58.1%

Lakeland is the hottest city in Florida — literally — and it has a housing market to match. Will home prices drop into a deep freeze? It’s anybody’s guess.

9. Provo, Utah

Home in Provo Canyon, Utah
Jason Finn / Shutterstock.com

Premium buyers are paying in this market: 58.11%

Provo residents are stuck with a dilemma that is common in fast-growing cities.

Provo made the list of the “10 Best Places for Career Opportunities in 2021.” But all that opportunity attracts educated, ambitious new Provo residents, who push housing prices ever higher.

8. Charlotte, North Carolina

Charlotte, North Carolina
Jon Bilous / Shutterstock.com

Premium buyers are paying in this market: 58.87%

Charlotte is another Sunbelt city where home prices have been on a scorching tear.

Those struggling to afford a home here can at least take some solace in the fact that Charlotte is one of the “15 Cities Where Your Dollar Goes the Furthest.”

7. Phoenix

Homes in Phoenix, Arizona
You Touch Pix of EuToch / Shutterstock.com

Premium buyers are paying in this market: 60.15%

Phoenix recently made the list of “The 10 Most Popular U.S. Cities to Move To.” When everybody wants to move to your town, it becomes more difficult to find a place to live.

All that competition only pushes prices even higher.

6. Atlanta

Atlanta, Georgia homes
RodClementPhotography / Shutterstock.com

Premium buyers are paying in this market: 60.84%

Atlanta has long been known as the unofficial capital of the so-called “New South.” People come here seeking opportunity and push home prices higher in the process.

5. Fort Myers, Florida

Fort Myers, Florida
Tono Balaguer / Shutterstock.com

Premium buyers are paying in this market: 62.31%

Back in 2009, Fort Myers was a poster child for all that had gone wrong in the housing bubble: Years of eye-popping price gains followed by an epic crash.

President Barack Obama even visited the city to tout his economic stimulus plan and the relief he hoped it would bring to down-on-their-luck Americans.

Fort Myers housing values have soared once again. Will the story have a different ending this time?

4. Ogden, Utah

Ogden, Utah
Paul W Thompson / Shutterstock.com

Premium buyers are paying in this market: 62.84%

Ogden is the third and final Utah city to make this list. It has been among the hottest housing markets in the U.S. throughout the pandemic.

3. Las Vegas

Las Vegas neighborhood with desert hills beyond.
Christopher Boswell / Shutterstock.com

Premium buyers are paying in this market: 63.73%

Las Vegas was one of the hardest-hit cities when the housing bubble burst more than a decade ago.

Now, prices once more have risen to nosebleed heights. Residents are rolling the dice that history will not repeat.

2. Austin, Texas

Austin, Texas
Brandon Seidel / Shutterstock.com

Premium buyers are paying in this market: 65.79%

As New York City, San Francisco and other big cities appear to be losing their grip on the hearts and minds of Americans, other cities are stepping to the fore. Austin was one of the “The 10 Most Popular U.S. Cities to Move To” during 2021 — and one of four Texas cities to make that list.

In the process, housing in Austin has become overvalued by more than 65%.

1. Boise City, Idaho

Boise, Idaho neighborhood
CSNafzger / Shutterstock.com

Premium buyers are paying in this market: 69.2%

Finally, no state in America is gaining popularity faster than Idaho. The state’s population grew by 3.4% last year, placing it No. 1 in the country in terms of gaining new residents.

But all those newbies have put pressure on the supply of housing, which is now overvalued by almost 70%.