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PMI Mortgage recently listed Pittsburgh as one of the nation's least risky housing markets along with San Antonio, Cincinnati, Indianapolis and Memphis. This echoes earlier reports inluding Smart Money magazine which called out city "undervalued."

These are the exceptions. PMI says forty-eight of the nation's 50 largest metropolitan statistical areas (MSAs) face a greater risk of declining home prices this quarter, adding the continued strength of the national and local economies suggests that in the absence of an economic shock, the once red-hot housing market will cool gradually. Appreciation has slowed in nearly half of the MSAs as compared to last quarter. Affordability remains a problem with eight MSAs registering affordability levels considered low by historical standards, due to appreciation and higher interest rates.

U.S. Market Risk Index scores increased for all of the top 50 MSAs except Chicago, IL, whose score decreased one point (New Orleans was not scored this quarter due to the catastrophic impact of Hurricane Katrina). Fourteen of the top 50 MSAs now have risk scores above 500, meaning they face a 50 percent or greater risk of home price declines in the next two years, up from 11 MSAs last quarter. The average score has increased from 261 last quarter to 287. The biggest change was in Minneapolis, MN, which gained 90 points, taking it to a score of 350 and up two spots in the ranking to No. 19.

Other U.S. Market Risk Index trends include:

-- In addition to Minneapolis, MN, MSAs that saw significant increases in risk were Virginia Beach, VA (+65 points to 274), Baltimore, MD (+62 to 279), Newark, NJ, (+61 to 427), New York, NY (+58 to 506), and Washington, D.C., (+56 to 401).

-- Riverside and Oakland, CA traded places, making Riverside No. 5 and Oakland No. 7. San Francisco and San Jose, CA also traded places, making San Francisco No. 10 and San Jose No. 11. Other than that, the top 15 are the same as last quarter with risk still clearly focused on the coasts.

-- There are now eight areas with Affordability Index scores below the vulnerability threshold of 70: San Diego, Santa Ana, Riverside, Sacramento, Oakland, and Los Angeles, CA, and Fort Lauderdale and Miami, FL. Long Island (Nassau-Suffolk), NY, San Jose, CA, and Tampa, FL are also considered potentially vulnerable with scores between 70 and 75.

-- While slowing, appreciation remains high by historical standards. Phoenix, AZ, Orlando, Fort Lauderdale, Miami, and Tampa, FL, Washington, D.C., Virginia Beach, VA, and Los Angeles, CA saw year-over-year appreciation of more than 20 percent.

The PMI report coincided with numbers from the National Association of Realtors showing second-home buyers now made up 40 percent of the market. The bulk (27.7 percent) of these are purchased for investment purposes.

The San Francisco Chronicle noted however that while risk for that city's homebuyers may be increasing, in the past 20 years the return for any five-year period ranged from a gain of nearly 50 percent to a loss of about 10 percent, with a median gain of 33 percent. Those who owned their homes for 15 years or more almost never incurred losses.