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The city of Austin has the second most overvalued housing market, Forbes reports.

According to data from Fitch Ratings, Forbes reports the Austin market is overvalued by 17 percent with a median value of $286,400. Austin is second to San Antonio which Fitch shows is overvalued by 18.6 percent with a median value of $202,600. The valuations are worse than in Las Vegas, Phoenix, or Portland, Oregon.

The ratings were determined using data for nominal income growth, population growth, unemployment, change in rental prices and change in home prices.

A good “rule of thumb” is for 25 percent of your income to go toward housing costs. But in Austin, the home builders association says they’re seeing easily 30-40 percent.

The Austin Housing market has changed drastically over the last decade. In June of 2006, the median price of a home in the area was $182,000. Even when the housing crisis began in 2008, the price was still up in Austin. It leveled off statistically for a few years. Then, in 2012, prices started shooting up. Five years later, it’s nearly $100,000 more.

 

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