How healthy is your city's housing market?

Boston has happy home buyers, while Las Vegas lacks reliable residents, according to a new study.

WalletHub, a consumer finance website, looked at how the housing recovery affected consumers across the country. Having the right type of financing could set home buyers up for success — and the risky kind could set families up for failure down the road, said WalletHub spokeswoman Jill Gonzalez.

So WalletHub ranked 25 metropolitan areas on homeowners' "financial freedom," using data from the Census Bureau's American Housing Survey. Researchers looked for signs of a healthy housing recovery: places with high home equity, a short amount time left on mortgages, and where a buyer with an average credit score could get an affordable interest rate and down payment of less than 20%.

The researchers also doled out black marks against cities with potentially risky borrowing, like "easy" mortgages. If a high percentage of buyers were using government assistance,  had a home equity line of credit or a lump-sum home equity loan, or owed more than their house was worth, the city moved down the list.

Metro areas with high equity values, low interest rates and strict lending practices show promise for a stable housing market recovery, Gonzalez said, while cities near the bottom still face challenges.

Consider the percentage of "underwater" mortgages: where the consumer owes more on the home than the home's value. Nationally, about 15% of mortgages fall in to this category, WalletHub said. Fewer than 7% of mortgages in Boston would be considered "underwater," while in Las Vegas, that figure is close to 40%.

Similarly, fewer than 10% of mortgages in Boston were obtained with no proof of income, assets or debt. In Tampa, that number is close to 24%, well above the national average of 17%.

"Each city has its own obstacles to overcome," said Gonzalez. "A place that is bringing in more young people, like Boston and New York, that’s going to be setting more people up to be buying than somewhere like Las Vegas."

Jeff Taylor is a managing partner at Digital Risk, an analytics company for mortgage lenders. He said there are a variety of regional trends that can affect a local housing markets, from first-time buyers looking to save money on rent, to foreign, all-cash purchases of pied-a-terres. 

"Nationally we have absolutely stabilized, but we still have two dynamics going on," Taylor said. "There are areas that will see price increases that’s based on high demand, like Miami and San Francisco. In Orlando or the Midwest, prices are growing more slowly as inventory has not made its way through the foreclosure process."

The study is not the first to show the housing market mounting an uneven recovery. While cities such as Denver and San Francisco are seeing home values skyrocket, others are seeing steady, but tapering, growth, according to the S&P/Case-Shiller Home Price Index, a measure of housing prices in 20 major American cities that was released Tuesday.

"We have outliers, like Orlando," Taylor said. "But as a country, we are heading in the right direction."