The housing market is out of control right now. There’s a historic shortage of housing stock, and things are particularly bad in the St. Louis region. Why is this happening? Many believe there’s another housing bubble, and private equity firms may be part of the problem, with out-of-town interests gobbling up much of what’s available.
If you’re trying to buy a house right now, you might face bidding wars against people willing to waive inspection or pay in all cash.
But if you’re selling, it’s a pretty good time, right?
Maybe so, but interest rates are likely to rise — potentially deflating the bubble quickly. And then there’s the glut of misinformation floating around, epitomized by this insane, irresponsible list published by FOX 2 this week. Entitled, “Cities with the fastest growing home prices in St. Louis metro area,” the list comes from Stacker, who in turn culled the information from Zillow.
“The coronavirus pandemic put an enormous strain on the economy, but created a real estate boom driven largely by people buying second homes as vacation properties,” it says, urging readers to “see if your home city made the list.” What follows is a North County-centric list that includes some of the poorest municipalities in the state.
At #3 is Kinloch, an historic Black community next to Ferguson that lost most of its population to the airport buyout in the 1980s, and now has less than 300 people. Much of the town has gone back to nature; there are barely any homes to be had there in the first place.
#2 is Berkeley, adjacent to Kinloch, which has more people, but also has high levels of violent crime, pretty much ensuring no one is buying up “vacation properties” there.
#1 is “Velda Village,” by which we think they mean Velda Village Hills, though they could also mean Velda City. Both are tiny North County municipalities that barely register, with about 1000 people each. The FOX 2 list claims that, in the past year home prices have risen there 54%, and over the past five years, 154.5 percent!
In reality next to nobody is buying “vacation properties” there. Perhaps the list makers confused “Velda Village” with its neighbor to the north Beverly Hills, and then in turn confused with the more-famous Beverly Hills in California.
I’m sure some poorly-considered algorithm spit out these numbers, but to publish this list with no curation and no context is downright irresponsible, encouraging visions of get-rich-quick schemes.
“It just goes to show,” says Chris Naffziger, an expert on St. Louis housing, “you can prove anything with statistics.”
