Housing Markets Becoming Overvalued

Housing Markets Becoming Overvalued

Despite a cool-off in home prices, more markets are overpriced than ever, according to a new survey.

Higher interest rates, especially for adjustable rate mortgages, helped push some housing markets into the overpriced category last quarter, according to Jeannine Cataldi, an economist with Global Insight, which conducted the analysis with National City.

Though rates have declined since the end of the second quarter, the 30-year fixed rate is still at 6.4 percent versus 5.8 percent a year ago. The difference for ARMs is even bigger.

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