October 2016 - Changing of the Guard

TheMReport — News and strategies for the evolving mortgage marketplace.

Issue link:

Contents of this Issue


Page 16 of 67

TH E M R EP O RT | 15 MDWELL T he 2016 presidential election has dominated national news coverage for months now, and every day, there's a fresh headline about the increasingly polarized American electorate. Popularly described as "red state" when the electorate leans Republican or "blue state" when the population leans more Democratic, there are significant cultural and economic differences between these two factions. At $27 trillion, residential real estate is the largest asset class in the U.S. It also represents a majority of most Americans' net worth. Given the importance of real estate to our economy, the HouseCanary data science team applied the most accurate real estate valuations in the market to every home in the U.S. What they found is a growing divide between red states and blue states. Just how big is the divide? Big. These findings, both surprising and alarming, are only the tip of the iceberg. You can find out more and download a full infographic at Who will be our next president? Will it be red or blue who wins? That we do not know. But what we can forecast is that the growing gap in real estate fortunes is only going to widen. Red State vs. Blue State Home Values–A Growing Divide $ 128K 80 % 77 % Source: HouseCanary values as of August 2016. Red state and blue state designations are based on FiveThirtyEight's election projection as of August 16, 2016. ( $128k average difference per home. In 1984, the values of homes in red states and blue states were about equal. Since then average home values in blue states have grown much faster than red states and now the average home in blue states is worth $128k, or 1.7 times more than red states. Since 2012, 80 percent of $6 trillion value creation went to blue states. Since the last election in 2012 real estate has recovered from the deep recession. The recovery was highly uneven. Of the $6 trillion in value creation in the U.S. housing market, 80 percent of this value went to blue states. 77 percent of the nation's real estate wealth is in blue states. Of the $27 trillion in total residential real estate values in the U.S., more than $20 trillion of real estate is in blue states and less than $7 trillion in red states. Where did the value go? A Growing Divide in Home Values.

Articles in this issue

Archives of this issue

view archives of TheMReport - October 2016 - Changing of the Guard