By Dees Stribling, Contributing Editor
It’s been about seven years since the mid-September 2008 collapse of Lehman Brothers turned a period of sluggishness — a recession had technically started at the end of 2007 — into the full-blown Panic of 2008, which evolved quickly into the deep and bitter Great Recession. Among many other affects on business, the recession pummeled the for-sale residential market, but soon gave a kick-start to the rental market as the percentage of home-owning households dropped. As for the commercial real estate market, it too slowed down, but recovered more quickly in some markets than others, as did overall local economies. (Mostly. Retail arguably hasn’t recovered in very many places yet.) In any case, the overall recession supposedly had ended by 2010, but the ill effects lingered on in many places.
Which major cities have enjoyed the strongest recovery from the recession? Since real estate markets are local, the strength of the recovery is an important consideration for developers, brokers and investors in any given market. WalletHub recently reported on the matter, finding that the top stop — the most recovered city — is Lubbock, Texas. In fact, the Lone Star State was well represented on the list, partly because of the pre-2014 growth in the energy industry: Corpus Christi was No. 3, Houston No. 5, and El Paso No. 10. Also in the top 10: Denver (No. 2), Anchorage (No. 4), Oklahoma City (No. 6), Minneapolis (No. 7), San Francisco (No. 8), and Fayetteville, N.C. (No. 9).
Oklahoma City also rebounded on the wings of energy, but Denver and San Francisco’s well-known recovery, which has fueled multifamily and office development and investment in particular, is mostly because of the expansion of tech. Other tech hubs are represented high on the recovery list, such as San Jose (No. 13), Austin (No. 14), Boston (No.17), Durham, NC (No. 19), and Seattle (No. 20). At the other end of the list are cities that haven’t recovered nearly as much from the recession, a fact that affects their real estate markets, too. They include Glendale and Tucson, Ariz.; Henderson and North Las Vegas; and coming in at No. 150 out of 150, San Bernardino, Calif.
To assess the progress of cities in their economic growth, WalletHub compared the 150 most populated U.S. cities across two key dimensions, including “Employment & Earning Opportunities” and “Economic Environment.” (“City” refers to city proper and excludes surrounding metro areas.) The company then compiled 17 relevant metrics, including the employment rate, the inflow of college-educated workers, median home prices, poverty rates, and more, even the likes of the average Experian Vantage Credit Scores, for the cities in question. For each metric (except Chapter 9 Bankruptcy Filings), WalletHub analyzed the change between its pre- and post-recession levels, and ranked cities in the two key dimensions, as well as overall.