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5 Housing Markets With Great Bargains (If You're Really Planning to Stay)

BOSTON ( TheStreet) -- Some U.S. housing markets still offer big bargains even though asking prices have risen 8.3% nationwide over the past year, market tracker Trulia.com says.

"Prices fell so much after the housing bubble burst that we're still in rebound mode," said Jed Kolko, Trulia's chief economist.

Trulia recently analyzed two key housing-market measures -- price-to-income ratio and price-to-rent ratio -- to see how current home values in the 100 largest U.S. cities compare with historic norms.

While the study concluded that nine markets have become overpriced, Trulia found that America's 91 other major cities remain undervalued by as much as 24%.

Trulia's research shows that the Sun Belt and the Midwest's Rust Belt offer many of America's biggest discounts.

Kolko says lots of Sun Belt cities top the list because they "had a big price bubble during the housing boom , followed by a big price decline when the bubble burst."

As for the Rust Belt, the expert says property values have fallen far below market fundamentals because of ongoing hits to the region's manufacturing base. "These places face long-term economic challenges," Kolko says.

Here's a rundown of the five cities Trulia believes offer America's most-undervalued home prices -- way below the 7% average deficit that the study found for the nation's 100 largest metro areas as a whole.

Trulia calculated property values by looking at asking prices for homes listed during April on Trulia.com, coupled with historic readings of the S&P/Case-Shiller Home Price Indices and Federal Housing Finance Agency data. The site then estimated price-to-income and price-to-rent ratios using federal statistics for each metro area.

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