Business Journal: Local Home Prices Overvalued

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(Sacramento, CA)
Wednesday, October 19, 2005

Only Los Angeles has homes that are more overpriced than Sacramento, according to a new analysis by PMI Mortgage Insurance in Walnut Creek. PMI is one of the largest private mortgage insurers in the U.S. and on several other continents. They pin a 31% overvaluation on the Sacramento region.

Still, the insurer sees less than a 50% chance that Sacramento will experience a price correction in the next two years. Ranked on this factor alone, Sacramento makes it into the 10 markets most at risk, including three others in California.

Among the 50 largest housing markets, PMI believes only 11 have homes that are undervalued.