FORTUNE magazine dedicated a extensive 7 page spread in its November issue to an article that helps explain future home values using Rent as a leading indicator. The premise, held up by Moody’s Economy.com, is that people will not spend excessively much more on rent than they will on home ownership UNLESS they are expecting a very large profit when they go to sell.

The article explains that housing prices and home ownership costs will fall back in line with rental rates. To look at it the other way around, home prices need to drop substantially in some areas where the boom to housing costs sky high and now have a 40% (Los Angeles) 36% (Ft. Lauderdale) 39% (Washington DC) correction. But not so in Cincinnati, we are looking at a mere 7% correction in rental to housing rate costs.

But even more interesting is that FORTUNE says that Cincinnati is one of only 4 cities (Detroit, Indy, Cleveland, Cincy) to see a home value INCREASE over the next 5 years. They believe that the sale price of an upscale home will rise from $284,000 to $301,000 by 2012. So we may have missed the bubble but we are one of lucky few graced with slow and steady home appreciation. Now that you know this it is probably time to get a hold of a licensed Cincinnati Real Estate Agent and start looking for the right house for you.