Fourth-most-undervalued market: Akron, Ohio
How much prices lag fundamentals:
Located just 40 miles south of Cleveland, Akron has a housing sector that suffers from many of the same problems its counterpart to the north faces.
"The decline of manufacturing has pulled prices down [in] many Rust Belt markets," Kolko says.
Trulia estimates that Akron home prices have dropped to 20.6% below what market fundamentals justify -- a big reversal from 2005, when valuations peaked at 19% above fair value.
But while long-term economic problems make Akron iffy for investors, Kolko says buying a home there looks like a good option for local consumers. Trulia estimates Rubber City residents can save 56% over seven years by buying properties to live in rather than renting.