Harvard University economist Edward Glaeser explains why housing won’t be a great investment for most homeowners moving forward – with the exception of those in the so-called “Superstar Cities” of New York, San Jose, San Francisco and Boston. Glaeser explains:
These areas have also, not coincidentally, maintained high housing prices despite the bust. According to recent data from the National Association of Realtors, San Francisco and San Jose remain the two most expensive metropolitan areas in the continental United States. …
Boston is a skilled (workforce) metropolitan area, and its restricted supply has led to high prices. But Atlanta is is now a skilled metropolitan area, as well, and its housing supply seems virtually unlimited. Why is it obvious that Boston can maintain a permanently higher price level than Atlanta?
File under: Back to the future