Housing Markets Turning Ugly In 2019

America’s housing market has been solid for at least seven years now, ever since home prices finally bottomed out from the crash in 2012. But as the United States economy enters its 10^th year of expansion, several industries and sectors are showing signs of weakness, notably housing. Mortgage rates have been declining, yet prices remain high and supply tight across many of the most popular markets. In other housing markets, the recent housing slowdown could be revealing deeper issues at play.

GOBankingRates evaluated 500 cities to determine which housing markets are suffering from high rates of foreclosures and underwater mortgages — aka homes with negative equity, which are worth less than what is owed — as well as changes in median home listing prices, the number of days homes are on the market and percentage of for-sale listings with price cuts. By analyzing each city and scoring them based on these factors, the study assembled a list of 50 housing markets, with the No. 1 place being the worst.

Find out which cities in the U.S. are seeing their housing markets turn ugly.

50 Housing Markets Turning Ugly

There’s significant geographic variation among these housing markets, but patterns emerge. Many of these housing markets lay in cities and states significantly impacted by deindustrialization over the last four decades, such as Connecticut, Illinois and Ohio. But the Rust Belt doesn’t account for all the housing markets featured in the study.

Florida

Florida is a complex state when it comes to housing markets. The state has been prone to volatility since as long ago as the 1920s Florida land boom up to the present day. All too often, real estate is fueled by foreign investors rather than local homebuyers. While there’s no state income tax, income inequality is rampant across many Florida metro areas. According to the Economic Policy Institute, some of the most unequal metro areas in the U.S. terms of incomes of the 1% vs.the 99% are the Naples, Key West and Sebastian-Vero Beach metro areas.

Demographics are another key variable. Many Florida cities are heavily populated and dependent on retirees, who may choose to downsize further or move in with their adult children in their later retirement years. In 11 out of the 15 Florida cities to make the list, residents aged 60-years-and-older comprise greater than 20% of the population; in Naples they make up more than 61%. Foreclosure rates are also higher-than-average in Florida, with No. 13 Riverview suffering from one foreclosure in every 796 homes, while the state’s largest city, No. 35 Jacksonville, experiences one foreclosure in every 814 homes.

Virginia

Virginia features several housing markets that made the list of 50. More importantly, all of them are in the Virginia Beach-Norfolk-Newport News metro area. Although home prices have increased over the last two years in many of them, Virginia’s housing markets are plagued by high rates of homes with negative equity.

According to Zillow, the percentage of homes with negative equity in the U.S. overall is 8.2%. By comparison, Suffolk, Virginia — which has the lowest rate of the Virginia cities to make the list — suffers an underwater mortgage rate of 14.8%. In Newport News, it’s nearly one-fifth of all homes with a mortgage. And in Norfolk, 20.6% of homes have negative equity. On top of this, foreclosure rates are above-average, with Portsmouth, for example, counting one foreclosure in every 730 homes, the highest rate in the study.

Illinois

Illinois is home to nine housing markets out of the study’s 50 that are turning ugly. One of the biggest downsides to homeownership in Illinois is the state’s high property taxes. In some areas of Illinois, property tax rates rise above 3%.

The No. 1 city whose housing market is turning ugly is Peoria, Illinois. Home prices dropped by nearly 16 percent over the last two years, from about $142,000 in July 2017, down to $124,450 in July 2019, according to Zillow. Meanwhile, more than a fifth of homes are underwater on their mortgage.

Here’s a breakdown of the top-10 housing markets turning ugly:

Check out the full breakdown of all 50 housing markets that are turning ugly

This post first appeared on Forbes.com. To see the original, click here.