What's the best way to tell whether the homes in your city are overpriced? There are lots of sophisticated measures, but the personal finance site GOBankingRates has picked up on one that is both very simple and very telling: The difference between the asking prices for homes and what homes actually are worth in today's marketplace.

To find the most overpriced cities, GOBankingRates combed through data on the nation's 722 biggest housing markets, comparing median listing prices in 2019 (through November) to Zillow's estimate of median home value, which is based on actual sales. Then it identified the 50 cities with the biggest difference (in dollars) between the two. 

What does it mean when homes in a city are being listed for much higher prices than they're actually selling for? There are a few possible explanations, none of them good. It could be that prices in this place are rising really, really quickly, so quickly that the time lag between when a house is listed and when it actually sells is enough to account for a big price increase. It's hazardous to buy in a market where prices are rising that quickly, though, because such a rapid increase might mean that you're in a bubble that could burst any time. 

A second explanation could be that sellers are jacking up their prices because there are few houses available to buy. Zillow has tracked a decline in available homes for sale this year. Buying in a market where there are relatively few homes for sale can be a smart move--if you can find a home you really like at an affordable price. But keep in mind that more housing could come on the market, say when developers build some, and that could drive prices back down.

A third possible explanation is that prices in your market are falling, or about to start falling. Realtor.com noted in May that, although average home prices in the U.S. were up for the previous 12 months, one in five American cities was seeing falling prices. In some cases, such as San Jose and San Francisco, the price drop simply reflects the fact that prices in recent years had risen to stratospheric levels that--not surprisingly--proved to be unsustainable. In other cases, a local event such as the algae bloom in Cape Coral, Florida, or the Kilauea eruption in Hilo, Hawaii caused prices to drop. Still, buying a house in a market where prices are falling can limit your options and even leave you underwater. So it's not a smart move unless you plan to keep the house for a fairly long time.

You can find GOBankingRates list of 50 most overpriced cities here. These are the worst:

1. Bethesda, Maryland

Median listing price: $1,219,050​

Median home value:  $971,090​

Overpriced by: $247,960

The difference between listing prices and home values in Bethesda is nearly a quarter of a million dollars. That gap is slightly more than the median value for a whole house in the United States, which is $243,225, according to Zillow.

What the heck is going on here? For one thing, inventory is low and there aren't enough homes for sale. Also, Bethesda Magazine noted a growing preference for homes in walkable neighborhoods, which means condos and townhouses are selling fastest. But that's also driven up the price for these smaller houses, which means that people with large houses can no longer cash in on their home's value by selling and moving to a smaller dwelling. At the same time, homeowners who are aware of the shortage of homes may be trying to hold out for the big bucks, driving listing prices to unrealistic levels.

2. Arcadia, California

Median listing price: $1,468,940

Median home value: $1,228,250

Overpriced by: $240,690

It seems the trade war is a big part of the explanation for what's gone wrong in Arcadia. Like much of the San Gabriel Valley, Arcadia benefited from a lot of foreigners buying U.S. homes. The area has been especially popular with Chinese buyers. But a slowdown in China's economy combined with the trade war and anti-immigrant rhetoric in the U.S. has slowed China's Southern California buying binge. It also means many of the homes purchased by Chinese nationals now sit unoccupied. The problem has gotten bad enough that the City of Arcadia now requires the owners of unoccupied houses to register those homes so that the city can "directly communicate with owners and/or their designated agents when issues need to be addressed."

According to Redfin, home prices in Arcadia have fallen 10.7 percent since last year, and homes take an average 67 days to sell. Rather than buy a home in Arcadia, it might be worth trying to get one of these absentee owners to let you house-sit...

3. New York City

Median listing price: $788,240

Median home value: $616,890

Overpriced by: $171,350

"It's Now a Buyer's Market in Manhattan Real Estate," declared a New York Times headline in October. The story went on to say that a decline in foreign buyers along with a new tax on luxury apartment purchases has cooled the real estate market there, bringing prices down by 8.2 percent compared to a year ago. Granted, even after that decline, the median price in Manhattan (for a co-op or condo, which is pretty much all there is) is $1.025 million. And one local real estate brokerage told the Times that properties in Manhattan spent an average 152 days--about five months--on the market before they sold. Manhattan is only one of New York's five boroughs, but falling prices there are likely to lead to similar trends throughout the city. 

4. Dallas, Texas

Median listing price: $387,659.90

Median home value: $224,620

Overpriced by: $163,039.90

It's clear that the real estate market in Dallas has cooled, although it's not clear whether that's just a reversion to normal pricing or something more. Redfin figures show that Dallas home prices have fallen a precipitous 39.7 percent since last year, whereas according to a D Magazine piece published in July, prices are still increasing, just more slowly than before.

What is clear is that there is still an influx of people to the area, which tends to boost housing prices, but at the same time Dallas has more new homes being built than any other city in the country. It may still be a good place to buy, but you should probably proceed with caution.

5. New Orleans, Louisiana

Median listing price: $327,650

Median home value: $168,820

Overpriced by: $158,830

A difference between listing price and home value of roughly $159k doesn't sound like all that much compared to about $248k in Bethesda. But in percentage terms, it's huge: Houses in New Orleans are being listed for almost twice as much as their actual value, according to Zillow. Yet at the same time, the NOLA housing market appears to be fairly stable, with Redfin recording a small average price increase compared to last year. 

One explanation may be what types of homes are selling--increasingly, according to an article on the website NOLA.com, a lot of home buyers are looking to the suburbs as an alternative to the city's high prices. As one local real estate expert noted, this comes after years of steadily rising prices. "Are we at a market peak or a new base line?" he asked. Good question.