More Good List-Based “News” from Forbes

The constant stream of lists from Forbes provides a great distraction and source of amusement. Their latest list is no exception. Behold the ten “Best Cities To Ride Out The Recession”:

  1. Austin, TX
  2. Oklahoma City, OK
  3. Honolulu, HI
  4. Portland, OR
  5. Tulsa, OK
  6. Virginia Beach, VA
  7. Seattle, WA
  8. Baltimore, MD
  9. Boston, MA
  10. Lancaster, PA

From the article:

The economy faces a tough recession, but it won’t hit equally everywhere. While some places will get pummeled, others will be far less scathed.

There are cities better poised to weather the crisis. Unemployment is on the rise almost everywhere, but in northwest cities like Portland and Seattle, northeast cities like Boston and Baltimore or energy and agriculture cities like Oklahoma City, Tulsa and Austin, it remains low.

Here’s a link to the summary of their “methodology,” in which they explain that the list is derived from looking at real estate data from Zillow, NAR, and Case-Shiller, job data, income estimates, and GDP for each city.

The hilarious thing to me is that basketball-stealing Oklahoma City was #2, while Seattle placed five spots lower at #7, also getting beat by Tulsa and Portland. Ouch.

Coincidentally, BusinessWeek generated a “Best Cities for Riding Out a Recession” list of its own (related article), which places Seattle lower, but still in the top 20:

  1. Arlington, VA
  2. District of Columbia
  3. Durham, NC
  4. Madison, WI
  5. Boston, MA
  6. Pittsburgh, PA
  7. Baltimore, MD
  8. Baton Rouge, LA
  9. New Orleans, LA
  10. Philadelphia, PA
  11. Lubbock, TX
  12. Anchorage, AK
  13. Lexington-Fayette, KY
  14. Buffalo, NY
  15. Lincoln, NE
  16. Irvine, CA
  17. Seattle, WA
  18. Chesapeake, VA
  19. Albuquerque, NM
  20. Corpus Christi, TX


Hey, we’re ten spaces lower than on the Forbes list, but at least we didn’t get beat by Oklahoma City.

(Joshua Zumbrun, Forbes, 10.15.2008)
(Prashant Gopal, BusinessWeek, 10.14.2008)

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

30 comments:

  1. 1
    CTT says:

    I don’t get the point of this post. Are you saying that Seattle is not one of the better places in the country to ride out the recession? Usually you comment on press you disagree with.
    C.

  2. 2
    The Tim says:

    I’m just pointing out that Seattle made two such lists, that’s all. I think the lists are fairly pointless and silly, but some take it to be good news to be included, and it’s at least worth mentioning.

    I thought it would be nice to have some positive, fluffy news to help balance out all the bad news lately on the economy (national and local).

  3. 3
    mikal says:

    But when you said hilarious about it I took it as a slam about Seattle. That is where you typically go.

  4. 4
    The Tim says:

    Read it again. What I said was hilarious was that OKC was ranked above Seattle on the Forbes list. But hey, you go ahead and read it however you want.

  5. 5

    ITS LIKE TRYING TO FIND A PUBLIC SCHOOL THAT TEACHES MATH AND SCIENCE ADEQUATELY

    There are worse ones out there than Seattle’s; but all of the above are basically subpar.

    The recession/depression ride in Seattle may include an extra teaspoon of rice at the bread line.

  6. 6
    mikal says:

    It’s Gregoire’s fault. First planning the budget poorly and now this. THE HORROR.

  7. 7
    Jonny says:

    I’m not as sceptical about seattle being on that list as portland. I think portland is going to get slammed hard.

  8. 8
    david losh says:

    These are both lists of job centers. The second one relies on government, health care, and education, while Forbes is looking at home equity.

    Forbes sounds like they are expecting people to be able to sell the family home in times of trouble. They also talk about foreclosure rates as an economic factor.

    Funny that those areas mentioned by Forbes as economically challenged were job centers during the construction boom.

    Wasn’t there a list of the fastest growing local economies that included Las Vegas, which ruined the town by the way?

    I swear the list of the worst places to ride out a recession according to Forbes is the same list of hottest places to invest in Real Estate two years ago.

  9. 9

    Maybe you can ride out a recession by living in Oklahoma City, but then you’d have to live there.

  10. 10
    Ron says:

    Yahoo finance shows the 30 Year is Jumping AGAIN~!! 6.38% NOW~!!

    30 Year Fixed 6.38% 5.87%

  11. 11
    Ron says:

    LIBOR- The Rate banks charge each other to borrow from each other…. PROBABLY THE MOST IMPORTANT NUMBER:

    4.1%

    The number has been coming down some the last week- Normal Conditions this number should be about 1%..

    When LIBOR explodes then the Fed Bank and those in control starting throwing Out Stimulus.. Many of you here probably already know this, however many here probably dont understand this.

    HERE IS LINK TO BLOOMBERG Chart- You might need to reload this sometimes there is problems connecting- might be because theres so many watching this.

    http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP%3AIND

    LIBOR is the Number that shows many of the problems underneath effecting the Credit Markets- it reflects the Costs of Credit Between Banks- this is something Ive been watching daily.

  12. 12
    Eleua says:

    I plan on riding out the recession in the PNW, so Seattle is #1 on my list. I do wonder how well our products will hold up in the coming depression.

    I can’t think of a city in the US that will get hit harder than Honolulu.

  13. 13
    Slumlord says:

    Anyone ever been to Smelterville, Idaho? I bet that place will actually get nicer during the depression.

  14. 14

    ” I do wonder how well our products will hold up in the coming depression.”

    Software and airplanes may not fare so well, but Aplets and Cotlets should hold up well.

  15. 15
    Scotsman says:

    Smelterville, Idaho gets my vote. There’s food and heating fuel in the nearby hills, and the riots of the city are far, far away.

    Eventually the cancellations will start rolling into Boeing, and video game and software sales will slow. Then we’ll see how well Seattle holds up. Right now I see most of the world as hanging in suspended animation as one straw after another is slowly loaded onto the camel’s back.

  16. 16
    jon says:

    I would expect video games to do quite well in a severe downturn. Nothing beats escapism when the real world has got you down. And they keep the kids off the street when you are working that second shift.

    I wonder if the strike is holding down the cancellation rate because orders are being pushed back anyway.

  17. 17
    rose-colored-coolaid says:

    I don’t get it…where’s Detroit on these lists?

  18. 18
    unearthly says:

    Wells 30-year jumbo fixed is almost 10%; 5-Year Jumbo ARM is at 8%…

    Wells Mortgage Rates

  19. 19
    david losh says:

    The rates are compensating for lower pricing. It’s the income they are looking for today. The case could be made that lower rates would create more loans, but the pricing still exceeds value.

    I was surprised by the articles when they mentioned median income. It is very low compared to property prices. So, I think, the reasoning is that it is better to have fewer high income loans on over priced assets than a bunch of lower rate loans on over priced assets.
    There will be more write downs for sure in the coming year, or two.

  20. 20
    Mark says:

    A little real estate talk – check out these units and the huge difference in price. They are in the same complex and are virutally identical.

    http://www.windermere.com/index.cfm?fuseaction=Listing.ListingDetail&ListingID=34378755

    http://www.windermere.com/index.cfm?fuseaction=Listing.ListingDetail&ListingID=34160726

  21. 21
    patient says:

    $475k for 1384 suburban condo sqft from 1979…you gotta be kidding. And $620k, good luck with that.

  22. 22
    mark says:

    “$475k for 1384 suburban condo sqft from 1979…you gotta be kidding. And $620k, good luck with that.”

    This is the Seattle Bubble Blog! These are lake front condos, so there is some value there. The following will give you an idea of how crazy things were in the past few years. This complex has many of the characteristics of what has gone on localy as well as nationaly over the past several years.

    The links here are from King County records. The last three sales in this complex have been for $585k, $595k, and $625k. The King County tax assesor values the units anywhere from $503k to nearly $1000k.

    The unit for sale is a foreclosure. The last owner financed the purchase with two loans, one being for 80%, with the second for 20%, in other, words nothing down. Four months after purchasing the unit he went in and refinanced both loans and took out an additional $90k in equity. Shorty after refinancing he quit making his payments and the unit went into foreclosure. It is now on sale for $475k, down from $550k. Even at the reduced price the unit sits on the market, and one of the other owners comes on the market and tries to sell at 2007 prices.

    The units in this complex were selling for around $165k back in 1997. $165k to $625k in ten years is a little over 14% per year compounded appreciation per year.

    An excellent example of how crazy the Seattle area real estate has become over the past ten years, and an idication of how owners refuse to give up bubble prices.

    http://www5.kingcounty.gov/kcgisreports/property_report.aspx?PIN=2472800070
    http://www5.kingcounty.gov/kcgisreports/property_report.aspx?PIN=2472800100
    http://www5.kingcounty.gov/kcgisreports/property_report.aspx?PIN=2472800130

  23. 23
    patient says:

    Absolutely crazy.

  24. 24
    Ray Pepper says:

    Off topic……….Seattle Home Show update**********Food is much better then T Dome………..

  25. 25
    Buceri says:

    Prices from my daily Redfin updates are all over the place (looking at under $300K). Places for $155 /sq.ft. and others for over $250. Common denominator though, is the price reduction across all units.

    Many are even showing prices lower than the purchasing price back in 2005.

  26. 26
    Markor says:

    Scotsman: Eventually the cancellations will start rolling into Boeing, and video game and software sales will slow.

    I agree with Jon, video games should do well. I’m pretty frugal but still buy video games for my kids, because the entertainment value is high. And of course kids love ’em.

  27. 27
    Tom says:

    I’m having a hard time believing *anyone* takes these lists seriously.

    Except VH-1’s Top Teen Stars’ Acne Problems of the ’80s.

  28. 28
    Ben says:

    Mark,

    Interesting information here. I have to wonder if the downside of a foreclosure on your record is a big enough downside to counter people taking $90k and walking away. You could rent for a long long time on that money.

    I also have to wonder if the no recourse loan days are over in the US. Australia does not do no recourse loans, and I believe that they suffer a lower foreclosure rate because of this.

  29. 29
    Red says:

    I have lived in few of the top cities from the list.

    Seattle might be in a better position considering # of jobs, but hell & no-Savings if you consider the cost of living/home.

    I think Seattle is definitely an over-rated city.

  30. 30

    PricewaterhouseCoopers’ Emerging Trends in Real Estate 2009 report took kindly to Seattle as well. FYI … by all outward appearances, they liked Seattle better than Oklahoma City too!

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