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Tuesday, October 28, 2014 2:47 AM


Most Expensive Housing Markets in US are Liberal: Correlation or Cause?


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Here's an interesting article thanks to Jed Kolko, Chief Economist at Trulia Trends via Washington Post Wonkblog: The most expensive housing markets in the U.S. are also the most liberal.

The relationship between housing affordability and politics in the US is startlingly strong as these charts by Jed Kolko shows.



Median asking price in dollars per square foot is on the vertical axis. Margin for Obama over Romney in the 2012 election is on the horizontal axis.

With the exception of Orange County California, all of the high priced counties voted for Obama.



The Washington Post notes ....

Nine of the 10 bluest markets had median home asking prices above $130 per square foot. All of the 10 reddest markets had prices below that. In the dark blue markets, housing cost almost twice as much ($227 per square foot) as in the red ones ($119). In metro Washington — this is not just the District — the average home asking price was about $177.

Trulia notes ...

Households in blue markets tend to have higher incomes. But those higher incomes are not enough to offset higher home prices. Our middle-class affordability measure, which reflects the share of homes for sale within reach of a median-income household, is significantly lower in bluer markets. Furthermore, blue markets have lower homeownership and greater income inequality than red markets.

Sorted Data

Trulia made the data available. I sorted by price per square foot high to low. Here are the results.

U.S. MetroVote margin: Obama vs Romney, 2012 (positive #s = blue markets; negative #s = red markets)Price decline in housing bust, peak to trough (FHFA)Year-over-year price change, Sept. 2014 (Trulia)Median asking price per square foot, $, Oct. 2014 (Trulia)
San Francisco, CA58%-23%9.9%613
Honolulu, HI39%-11%4.1%439
San Jose, CA42%-26%8.6%430
Orange County, CA-6%-33%4.8%363
Long Island, NY6%-20%2.9%350
Oakland, CA50%-39%11.9%342
Los Angeles, CA42%-35%6.9%334
New York, NY-NJ49%-18%4.3%320
Ventura County, CA7%-39%12.4%305
San Diego, CA8%-35%1.8%296
Fairfield County, CT11%-21%-0.5%237
Middlesex County, MA27%-13%7.8%236
Boston, MA25%-17%4.5%229
Peabody, MA16%-18%4.0%212
Seattle, WA35%-26%8.9%197
Bethesda-Rockville-Frederick, MD34%-22%2.6%189
Sacramento, CA9%-48%10.1%188
Edison-New Brunswick, NJ3%-22%6.2%180
Miami, FL24%-47%14.0%180
Washington, DC-VA-MD-WV37%-25%3.2%177
Riverside-San Bernardino, CA4%-50%10.6%164
Providence, RI-MA25%-26%2.8%162
Baltimore, MD18%-22%-1.1%161
Portland, OR-WA23%-25%7.5%157
Denver, CO13%-8%9.4%152
North Port-Bradenton-Sarasota, FL-10%-50%9.6%150
New Haven, CT22%-21%-0.6%146
Worcester, MA9%-23%4.9%146
Philadelphia, PA31%-11%4.3%146
Fort Lauderdale, FL35%-48%6.9%143
Hartford, CT23%-14%-0.4%143
West Palm Beach, FL17%-49%11.7%138
Springfield, MA32%-14%2.5%137
Albany, NY16%-6%-0.7%135
Tacoma, WA11%-32%7.5%134
Charleston, SC-5%-21%7.7%134
Cape Coral-Fort Myers, FL-17%-56%9.8%133
Newark, NJ-PA21%-20%1.9%133
Fresno, CA2%-49%8.5%133
Austin, TX7%-4%9.9%130
Lake County-Kenosha County, IL-WI9%-27%11.3%130
Chicago, IL32%-28%10.0%129
Salt Lake City, UT-21%-22%4.7%129
Virginia Beach-Norfolk, VA-NC11%-19%4.4%129
Bakersfield, CA-17%-52%8.2%126
Minneapolis-St. Paul, MN-WI12%-26%10.0%125
Phoenix, AZ-11%-51%3.8%123
Wilmington, DE-MD-NJ24%-20%3.8%123
Warren-Troy-Farmington Hills, MI3%-37%7.8%117
Camden, NJ24%-23%0.6%116
Richmond, VA5%-20%2.7%116
Milwaukee, WI5%-15%5.8%116
Pittsburgh, PA-1%-2%6.9%116
Allentown, PA-NJ2%-21%2.6%114
Las Vegas, NV15%-61%9.0%113
Raleigh, NC6%-9%4.2%113
Dallas, TX-10%-6%7.7%112
Tucson, AZ7%-38%1.4%111
Orlando, FL8%-48%7.7%110
Albuquerque, NM13%-17%0.6%110
Nashville, TN-16%-9%5.6%109
Jacksonville, FL-19%-38%7.0%109
Colorado Springs, CO-21%-12%4.0%107
San Antonio, TX-8%-4%4.5%107
Tampa-St. Petersburg, FL3%-43%5.0%106
Houston, TX-12%-4%10.7%106
New Orleans, LA0%-11%7.5%102
Palm Bay-Melbourne-Titusville, FL-13%-50%13.1%100
Cincinnati, OH-KY-IN-16%-10%9.0%100
Baton Rouge, LA-12%-3%1.3%100
Charlotte, NC-SC2%-16%7.0%99
Oklahoma City, OK-27%-3%4.0%98
St. Louis, MO-IL7%-12%4.3%98
Knoxville, TN-34%-8%2.1%98
Birmingham, AL-20%-13%11.5%96
Buffalo, NY14%-2%3.1%96
Atlanta, GA1%-26%11.1%95
Louisville, KY-IN-3%-6%11.0%94
Fort Worth, TX-23%-6%6.4%94
Columbus, OH7%-10%6.5%94
Omaha, NE-IA-10%-5%5.4%93
Greenville, SC-30%-8%5.9%92
Kansas City, MO-KS-3%-12%6.6%92
Lakeland-Winter Haven, FL-7%-46%11.1%92
Gary, IN21%-11%6.8%91
Little Rock, AR-11%-4%-6.0%90
Tulsa, OK-32%-4%7.3%90
Syracuse, NY17%-3%4.1%90
Memphis, TN-MS-AR12%-14%4.6%89
Greensboro, NC1%-10%2.6%89
El Paso, TX32%-8%-0.9%88
Rochester, NY11%-2%2.0%87
Grand Rapids, MI-9%-22%9.1%87
Cleveland, OH24%-18%4.1%86
Akron, OH13%-16%6.9%84
Columbia, SC2%-11%-0.9%83
Toledo, OH21%-20%12.5%81
Indianapolis, IN-8%-7%7.8%80
Detroit, MI47%-40%11.4%75
Dayton, OH-7%-13%8.8%74


Congratulations to California

  • California has seven of the top-ten least-affordable metro areas.
  • New York managed two top-ten least affordable spots.
  • Massachusetts garnered three top-fifteen slots. 

Congratulations (of sorts) go to California.

Top 10 Cities by Population in 2013

City RankCity PopulationCost per Sq FootCost Ranking
1New York, New York 8,405,8373208
2Los Angeles, California3,884,3073347
3Chicago, Illinois2,718,78212942
4Houston, Texas2,195,91410666
5Philadelphia, Pennsylvania1,553,16514629
6Phoenix, Arizona 1,513,36712347
7San Antonio, Texas 1,409,01910764
8San Diego, California1,355,89629610
9Dallas, Texas1,257,67611257
10San Jose, California998,5374303


I created the above table by combining City Size  data with Trulia data.

Top 10 Red vs. Blue

Of the 10 largest Metro Areas in the US, five voted for Obama and five for Romney. Note: The above table shows city population not metro area.

The Texas Metro Areas (Houston, San Antonio, Dallas) and the Arizona Metro Areas (Phoenix and San Antonio) voted for Romney.

The highest ranking red Metro Area in the list was Phoenix. It placed 47 out of 100 in cost, with a median cost per square foot of  $123 vs. San Jose, California with a median cost of $430 per square foot.

Correlation or cause? Union work rules, land availability, and building restrictions (or lack thereof) are all likely in play.

Correction

I stated 5 of the top 10 cities voted for Romney. The Trulia data is for Metro Areas. The above paragraphs modified accordingly.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

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