News

Tax credit fuels skyrocketing Dallas-area preowned home sales

07:28 AM CST on Tuesday, December 8, 2009
By STEVE BROWN/ The Dallas Morning News

The North Texas housing market came roaring back in November.

Pre-owned home sales rose 31 percent last month from a year ago – one of the biggest increases on record and the second consecutive month of rising sales.

Median home sale prices were up 5 percent, the largest gain in more than two years.

“This is another positive signal that the local housing market may have turned the corner,” said D’Ann Petersen, business economist with the Federal Reserve Bank of Dallas. “It is probably still too soon to declare a rebound, but two months of positive sales certainly suggest improvement.”

Throughout North Texas, real estate agents sold almost 5,500 pre-owned homes in November through the Multiple Listing Service, according to statistics released Monday by North Texas Residential Information Systems and the Real Estate Center at Texas A&M University.

The jump in residential transactions came as homebuyers rushed to take advantage of the federal homebuying tax credit, which has been extended into the spring.

“While the tax credit likely played a role in some of the activity, increased sales in areas unaffected by the tax credit suggests buyers are becoming more confident that the worst is behind us,” Petersen said. “Home prices have firmed locally and nationally, and that may be spurring buyers to make decisions now, especially given that mortgage rates remain very attractive.”

Indeed, many neighborhoods that weren’t affected by the federal homebuying incentive saw dramatic spikes in home sales.

In the Park Cities, pre-owned home sales soared 81 percent in November from a year ago. Sales in close-in North Dallas neighborhoods were up by 60 percent.

Condominium and townhouse sales were up more than 60 percent from a year ago.

A different year

November’s robust sales activity is the latest in a string of recent indicators that suggest that the North Texas home market has bottomed out and may be turning the corner.

Through the first 11 months of 2009, North Texas home sales are still down 12 percent from the same period last year.

One reason last month’s home sales look so strong is that the market almost came to a halt a year ago at the height of the economic spiral.

“A year ago, we thought economic Armageddon was at the doorstep,” said Bernard Weinstein, an economist with Southern Methodist University. “So no one was doing anything, including buying homes.

“The percentage gains in home sales are very impressive,” he said. “But remember, they come off of significantly depressed numbers a year ago.”

Still, the unexpected spike in home sales in affluent areas – where buyers had all but pulled out of the market in recent months – is a strong positive sign.

High-end home sales had been down more than 40 percent earlier this year.

James Gaines, an economist for the Real Estate Center at Texas A&M University, said that it shows “lenders opening coffers for high-priced, credit-worthy borrowers.”

“Most people with money can’t figure out where to invest, so buying a home in the best locations for the long term is not a bad investment,” he said.

Limited inventory

But buyers who decide to test the waters in the home market might not find as many options as they expect. The number of homes listed for sale in the MLS is at its lowest level in more than three years.

And at the end of November, the inventory of unsold homes on the market fell below six months, which is considered a balanced market.

“If the inventory remains below a six-month supply like it is now, prices should continue to firm up,” said David Brown, who heads the Dallas office of housing analyst Metrostudy Inc.

But Brown cautions not to expect continued big increases in monthly home sales.

“I won’t be surprised to see a drop-off in sales during December and January now that the urgency of the tax credit deadline has passed,” he said. “The expansion of the tax credit to include move-up homebuyers should help spur sales early next year and into the spring.

“Beyond next spring, job growth will need to re-emerge to maintain the increased sales pace.”

Texas’ Existing Home Sales Climb, Prices Inch Up

TEXAS (Real Estate Center, Realtor.org) – A total of 19,347 existing single-family homes were sold in Texas last month, a 15 percent increase from October 2008, according to MLS data compiled by the Real Estate Center at Texas A&M University.

The median price rose 1 percent to $143,300 during the same period, and the state finished the month with a 6.9-month inventory of existing homes.

Here is how select Texas cities fared in October (data current as of Nov. 24, 2009):

	Sales	Change from Last Year	Median Price	Change from Last Year	Months’ Inventory
Abilene	163	up 41%	$97,700	down 26%	5.5
Austin	1,993	up 38%	$179,800	down 5%	6.1
Dallas	4,146	up 12%	$153,000	down 1%	6
Fort Worth	833	up 8%	$112,300	no change	6.5
Houston	5,388	up 14%	$148,000	up 4%	6.4
Longview-Marshall	176	down 6%	$121,500	up 2%	8.9
McAllen	188	down 3%	$101,500	down 7%	13.6
Midland	121	down 6%	$165,500	down 3%	1.8
San Antonio	1,760	up 24%	$138,600	down 4%	7.7
San Marcos	14	up 27%	$150,000	up 5%	9.1
Texas	19,347	up 15%	$143,300	up 1%	6.9

Additional home sales data for these and other major Texas cities are available on the Center’s website.

At the national level, the National Association of Realtors reported this week that single-family home sales rose 9.7 percent to a seasonally adjusted annual rate of 5.33 million in October from a pace of 4.86 million in September. That was 21.4 percent above the October 2008 pace. The median price was $173,100 in October, down 6.8 percent from a year ago.

9 Tips for Improving Your Credit Score

 

Posted By Paige On November 14, 2009 @ 12:04 am In Real Estate, Today’s Marketplace, Today’s Top Story, Today’s Top Story – Consumer | Comments Disabled

Obama signs homebuyer, jobless bill assistance

 Reuters – U.S. President Barack Obama makes remarks about a shooting at a U.S. Army base in Fort Hood, Texas, at …

WASHINGTON – President Barack Obama signed into law a $24 billion economic stimulus bill providing tax incentives to prospective homebuyers and extending unemployment benefits to the longtime jobless who have been left behind as the economy veers toward recovery.

The bill-signing at the White House Friday came a day after the House, displaying rare bipartisan agreement over the seriousness of the jobless situation, voted 403-12 for the measure. The Senate approved it unanimously on Wednesday.

The White House said the law, which also includes tax cuts for struggling businesses, builds on provisions in the $787 billion stimulus package enacted last February that aim at spurring job creation.

“The need for such a measure was made clear by the jobs report that we received this morning,” Obama said, citing Friday’s government report the jobless rate hit 10.2 percent last month, the highest since 1983. The rate was 9.8 percent in September.

He called it a “sobering number that underscores the economic challenges that lie ahead” and pledged more work.

“I will not rest until all Americans who want work can find work,” he said during a Rose Garden appearance before reporters.

Lawmakers stressed that the fourth unemployment benefit extension in the past 18 months was necessary because initial signs of economic recovery have not been reflected in the job market.

“The truth is that long-term unemployment remains at its highest rate since we began measuring it in 1948,” said House Majority Leader Steny Hoyer, D-Md. About one-third of the 15 million people out of work have gone at least six months without a job.

The law provides another 14 weeks of benefits to all out-of-work people who have exhausted their benefits or will do so by the end of the year, estimated at nearly 2 million. Those in states where the jobless rate is 8.5 percent or above get an additional six weeks.

The Labor Department announced Friday that that employers shed another 190,000 jobs in October. Obama said job creation traditionally lags behind economic growth, but said it is small comfort to those seeking work.

“So although it will take time and it will take patience, I am confident that our economy will recover,” Obama said. “I’m confident that we’re moving in the right direction. And I promise that I won’t rest until America prospers once again.”

The extra 20 weeks could push the maximum a person in a high unemployment state could receive to 99 weeks, the most in history. Unemployment checks generally are for about $300 a week.

The tax credits, added by the Senate, center on extending the popular $8,000 credit for first-time homebuyers that was included in the stimulus package. The credit, which was to expire at the end of this month, will be available through next June as long as the buyer signs a binding contract by the end of April.

The program is expanded to include a $6,500 credit for existing homeowners who buy a new place after living in their current residence for at least five years.

The credit, said Democratic Rep. Shelley Berkley of Nevada, a state particularly hard hit by the recession, “will allow more people to purchase a home in my district and help stop the continued downward spiral in housing prices caused by the foreclosure crisis.”

Prolonging the life of the homebuyer credit has been a priority of the real estate industry, which says it has been instrumental in beginning to turn around a market that was a major cause of the economic downturn. About 1.4 million first-time homebuyers have qualified for the credit through August, and the National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.

The other tax credit allows businesses that have lost money in 2008 or 2009 to get refunds on taxes paid on profits during the five previous years.

The Senate spent more than a month crafting the package and working out partisan fights over amendments, angering lawmakers and others who pointed out that 7,000 people lose their unemployment benefits every day. The National Employment Law Project estimated that 600,000 workers exhausted their benefits in September and October while Congress debated the legislation.

The lead sponsor of the bill in the House, Rep. Jim McDermott, D-Wash., reminded lawmakers that they’ll have to revisit the issue again before adjourning for the year. The bill applies to benefits exhausted this year, and “Congress must act again before the end of this year to continue the extended unemployment benefits that we are now improving.”

The more than $21 billion cost of the tax credits would be paid for largely by delaying a tax break for multinational companies that pay foreign taxes — a fact Obama touted.

“Now, it’s important to note that the bill I signed will not add to our deficit. It is fully paid for and so it is fiscally responsible,” he said.

The cost of the unemployment benefit extension, about $2.4 billion, is offset by extending a federal unemployment tax that employers must pay.

___

The bill is H.R. 3548.

“Bottomed Out; The End is Here!”

-Consensus from RECON, Others on Housing Market-

“It appears we are at the bottom of the housing market in most Texas cities,” said Real Estate Center Director Mark Dotzour after reviewing the state’s latest home sale numbers.

“Housing affordability has never been higher. If you plan to live in the house for at least two or three years, now is the time to buy.”

“The Texas inventory of unsold new and existing homes is in good shape.”

“Zero Short-Term Rates Going Nowhere” -New York Times-
The Federal Reserve announced last week that it will keep its benchmark short-term interest rate at virtually zero for some time, while giving the most optimistic assessment of the national economy in more than a year, characterizing it as “leveling out.”

Mortgage rates should remain low as long as the federal government continues to purchase almost all residential mortgages. When they stop, rates will move up.

“If you are planning to build a home to retire to in the near future, now is a great time to do it. Contractors are plentiful, construction costs are lower and mortgage money is cheap,”

DFW Housing Looking Up-Dallas Morning News
“We are beginning to see some more positive trends in the housing market, which is great news,” said David Brown, head of the Dallas Metrostudy office. “Both the new home and resale closings during the last quarter suggest the market is bottoming out in sales volume.”

Houston’s Economy, Paychecks Flush –Houston Chronicle-
– Houstonians pocketed bigger raises than those in most other parts of the U.S., according to the U.S. Bureau of Labor Statistics. It was Houston’s relative prosperity and 8 percent unemployment rate that contributed to the area’s pay raises, according to Joel Wagher with Workforce Solutions.

Texas leads the nation in homebuilding

07:35 AM CDT on Tuesday, July 28, 2009
By STEVE BROWN / The Dallas Morning News
stevebrown@dallasnews.com

Texas cities continue to lead the nation in homebuilding, even in the face of huge construction cutbacks.

Houston and Dallas-Fort Worth are the top markets in the country for building permits for single-family homes, based on numbers for the 12-month period ending in May.

And Texas had more homebuilding permits than California and Florida combined, according to data provided by California-based John Burns Real Estate Consulting.

Austin and San Antonio also rank among the country’s 10 busiest homebuilding markets.

“Texas didn’t see the downturn in the housing market the other states did,” said Lesley Deutch, a vice president at John Burns.

“Florida and California have really pulled off their permit totals, but Texas is still high up there.”

During the 12 months ending in May, almost 64,000 single-family homebuilding permits were recorded in Texas.

Houston had almost 22,000 permits, and more than 15,000 were recorded in the Dallas-Fort Worth area.

“It’s not surprising that we lead the country – both because every place is really hurting and we’ve held up relatively well,” said Dr. James Gaines, an economist with the Real Estate Center at Texas A&M University.

“We do have to be careful that we don’t build just for the heck of it.

“Most of the builders I’ve talked to say they are doing mostly contract work with just a few speculative homes here and there and only by those with capital resources to be able to finance it.”

Gaines is forecasting a 25 percent drop in homebuilding permits in Texas this year, “the lowest level we’ve had since 1992.”

“Builders have to build somewhere, and Texas is about the only game in the country,” he said.

“We still have a growing population – although not as much – and our home prices and markets have held up pretty well.”

At midyear, home starts in the Dallas-Fort Worth area were down about 70 percent from mid-2006 levels.

“The industry understands that Texas has performed much better than the rest of the country throughout the downturn,” said Ted Wilson, a housing analyst with Dallas-based Residential Strategies Inc.

“But to say that there hasn’t been pain here is a misstatement.

“Yes, the market has been better here, but you aren’t going to find many builders crowing about local market demand.”

Top homebuilding markets
Based on single-family home building permits for the 12 months ending in May:
1. Houston 21,921
2. Dallas-Fort Worth 15,115
3. Phoenix 9,293
4. Washington, D.C. 7,498
5. Atlanta 7,100
6. Austin 6,411
7. San Antonio 5,271
8. Riverside-San Bernardino, Calif. 4,888
9. Charlotte, N.C. 4,810
10. Raleigh-Cary, N.C. 4,678
Top states:
Texas 63,993
California 25,766
Florida 24,027
North Carolina 20,292
Georgia 13,573
SOURCE: John Burns Real Estate Consulting

Report predicts minimal risk for home price declines in DFW

7/8/2009

There’s a “minimal” chance that DFW home prices will be lower in two years than they are today, according to the latest study by mortgage insurance firm PMI Group.

Dallas and Fort Worth rank among the U.S. cities that are the least likely to see a drop in home prices in PMI Group’s first-quarter risk report.

Dallas’ housing market has only a 3.8 percent risk of lower home prices two years from now. In Fort Worth, the likelihood is 5.8 percent.

That compares with a 65.5 percent risk of overall lower home prices in the 50 largest U.S. cities.

The risk of falling home prices rose in the first quarter in 45 of the country’s 50 largest metropolitan areas, including Dallas and Fort Worth.

Dallas’ home price risk is up from 2.5 percent a year earlier. The Fort Worth risk index moved up from 2.5 percent a year earlier.

[Dallas Morning News]

Bill Seeks to Suspend Appraisal Code

This article talks about a bill that will be very good news for my clients.

U.S. Reps. Travis Childers (D-Miss.) and Gary Miller (R-Calif.) have teamed up to champion a bill that would put a moratorium on the new Home Mortgage Valuation Code of Conduct.

HVCC is an agreement between Fannie Mae, Freddie Mac, and the New York State Attorney General that went into effect earlier this year with the aim of improving the accuracy of appraisals, although it’s come under criticism in the real estate industry for causing its own problems.

Although the agreement involves the New York AG, it’s being applied nationwide to all the mortgages handled by Fannie Mae and Freddie Mac.

The bipartisan legislation directs the Federal Housing Finance Agency, which is the conservator of the two secondary mortgage market companies, to suspend the code for 18 months.

Among other things, the code has been criticized by the National Association of Mortgage Brokers for delaying residential property closings and costing its members business at a critical time. Group members also are up in arms about having to pay high fees to appraisal management firms.

[Editor's note: The NATIONAL ASSOCIATION OF REALTORS® has communicated its own concerns over HVCC to the New York State Attorney General and federal lawmakers and policymakers.]

Source: American Banker (06/30/09)

© Copyright 2009 Information Inc.

How is the DFW Real Estate Market?

According to  RECON

Real Estate Center Online News

June 19, 2009

HOUSTON, DFW HOUSING MARKETS SHINE

HOUSTON (Dallas Morning News) – The Brookings Institution has named Houston and Dallas–Fort Worth two of the top housing markets in the country.

Houston ranked first and DFW third among metro areas that have been the least affected by falling home prices.

Home prices in DFW were up slightly in first quarter 2009 compared with those in first quarter 2008, according to the Federal Housing Finance Agency’s quarterly House Price Index.

Of the top 100 metro areas, 38 avoided home-price declines over the last year.

PRESIDIO JUNCTION, WHATS YOUR FUNCTION?

FORT WORTH (Cencor Realty Services) – LNR Commercial Property is finishing infrastructure work on Presidio Junction and beginning vertical construction.

The 300-acre mixed-use development North Tarrant Pkwy. and I-35W will have more than one million sf of retail, restaurants and shops, 1,300 apartment units and 750,000 sf of fitness, hotel and Class-A office space.

Vertical construction has begun on 348 apartment units within the development.

The retail component of Presidio Junction is being handled by the Weitzman Group. Major retailers include a Lowe’s home improvement center.

 SAN ANTONIO ECONOMY OUTPERFORMS NATION

SAN ANTONIO (San Antonio Express-News) – The San Antonio economy has outperformed all of the nation’s largest cities through first quarter 2009, according to a Brookings Institution report.

The city has become accustomed to being labeled a top economy. It recently ranked fifth on Forbes.com’s list of cities most likely to bounce back quickly from the recession.

San Antonio’s economy — driven by sectors such as health care and insurance — has benefited greatly from military expansions and relatively stable housing prices.

The Brookings Institution report measured changes in employment totals, unemployment rates, housing prices, the values of goods and services produced by cities, and other factors.

Other Texas cities listed as top-performing metro areas include:

• Austin (third),
• Houston (fourth),
• Dallas (fifth),
• McAllen (sixth) and
• El Paso (11th).