4610 Wildwood poolWe know that sales of homes priced at $1 million plus are out of sight and up 53 percent in North Texas from a year ago. I think my message from Luxury Portfolio last month in Las Vegas was clear: luxury and multi-million dollar properties are not just alive but selling well.

Sales of modestly priced houses in the area have slowed down about 25% less than they were a year ago, according to Steve Brown, who also says overall sales by real estate agents are flat this year.

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Nicole StewartHere is one of the finest columns ever written by Dallas Morning News columnist Steve Blow. The subject is a can’t win topic: half the people who read it will agree, half won’t. But Steve Brown did such an excellent job of letting the narrator, Nicole Stewart, tell the story, her story, it’s almost as if he is in the background, serving drinks like one of the footmen on Downton Abbey.

With a story like this, that’s how it should be.

Regardless of how you feel about the controversial subject of abortion, you will find that this story pulls at your heartstrings. It is a realistic portrayal of what thousands of women go experience when a pregnancy does not “go right”, and why I personally believe abortion should be left as a personal decision between a woman, her physician, her partner, and no one else.

You may disagree, and I respect that tremendously.

Nicole is the founder of Oral Fixation, a local theater series featuring true-life storytelling on stage by real life Dallas people. This is no open mike: every story is curated and edited, under Nicole’s guidance. Each show is loosely themed on a figure of speech or theme, such as pregnancy, or an upcoming performance called White Elephant.

“Every word is earned,” says Nicole, the show’s creator. “There are no ums and likes.”

She works with the writers behind the scenes, almost like the producer of an album, providing notes and teasing out the best stories to ensure there’s “not a single stinker” in the batch. I saw “Bun in the Oven”, stories on pregnancy, abortion, and one entrepreneur who actually changed his life and career with a “bun in the oven” in the form of pizza dough. The performances range from gut-churning to riotous, from dark, horrifying stories of rape to confessionals of awkward sexual intimacy. “You’re getting to see behind the mask of someone’s face,” she says.”

Indeed, you are, and I love this stuff.

You may wonder why I have jumped on this story for a real estate blog? Nicole happens to be the grand-daughter of Henry S. Miller, Jr. one of Dallas’ most revered real estate developers and leaders, who bought Highland Park Village in the 1970′s, and who was a huge contributor to Dallas charitable landscape.

 

 

Statler-Hilton-Block-Panora

Update Nov. 9: This must be a new retro trend — the live music venue! I’m told the developer refurbishing the At. Anthony Hotel in downtown St. Antonio also has plans to re-vive a ballroom and live music venue on the rooftop. Seems that, in the 1940′s and ’50s, folks would go down to the St. Anthony and dance to live bands while local radio stations broadcast the music. Perhaps this is what Mehrdad has in mind? (ce)

We love Mehrdad Moayedi, whom we’ve dubbed “Saint Stoneleigh.” Steve Brown at the DMN wrote yesterday what we wrote a month ago: Moayedi is buying downtown Dallas’ iconic Statler Hilton with plans for a residential conversion with unique amenities.

But this building has had previous owners and big plans before, but none that have come to fruition. There are several hoops to jump through with this William Tabler-designed building — including parking and other abatement concerns — some of which have stymied successful developers such as Jack Matthews of Matthews Southwest.

But Moayedi’s Centurion American breathed life back into the Stoneleigh, is well equipped to revive the 19-story Midcentury stunner of a hotel on Commerce Street. We also love that Moayedi want’s to bring more amenities to downtown with this project, including a movie theater and a grocery store. There’s also been talk of a live music venue. Wonderful ideas, and all sorely needed downtown.

 

 

 

 

citylightsland

 

(Photo: Steve Brown/DMN)

It was just three months ago that all anyone in urbanism forums or on staff at city magazines could talk about was this “A New Dallas” campaign to raze Highway 345 that bisects the urban core of Dallas. As the beautifully constructed website said, the 345 was already crumbling, so instead of investing money in rebuilding it, we should tear it down and invest in a slower urban infrastructure.

Well, some of the “enormous amount of underdeveloped land around IH 345”  is going to get a mighty fine building that will have a mighty fine view of … a crumbling highway. I know it sounds like a bummer, but it obviously puts dollar signs in the eyes of South Carolina-based Greystar, the developer planning Elan City Lights for a vacant lot at Live Oak and Good Latimer.

A New Dallas

According to a story from Steve Brown, Greystar envisions a 424-unit luxury apartment building on the site they purchased from Key Bank for $39.43 million, which is actually pretty close to the AMLI development just across the street from the now weed-covered lot that at one time had a very interesting collection of plastic bags and hubcaps adorning its chain-link fence.

I wonder if Greystar would be for the “New Dallas” urbanists fell in love with this summer? I’m betting they would, considering that the prices for these luxury units would be a lot higher if they had views of something other than a highway. Greystar expects to start construction next month on City Lights with the first units hitting the market in fourth quarter 2014.

Housing Starts

(Photo: Dallas Morning News)

I am very cautiously optimistic about our market, y’all. I want to be just ridiculously, pie-in-the-sky buoyant about North Texas resilience that has us leading multi-family construction as well as seeing gains in new home starts.

According to Dallas Morning News reporter Steve Brown, North Texas is building multi-family developments faster than any other state in the nation, raising rents an average of 3 percent, as well as hitting an annual leasing record in June. From his July 3 story:

Analysts at Carrollton-based MPF Research credit the apartment sector’s recent gains to the area’s growing business environment.

“They clearly reflect the strength of the local economy,” MPF’s Jay Parsons said in a report released Tuesday. “Dallas-Fort Worth isn’t just adding a lot of jobs, it’s adding the types of jobs that draw the key demographic for the apartment market — educated young adults.”

Developers are certainly doing their part to meet the demand for new apartments.

At the end of June there were 24,697 apartments under construction in North Texas — just a hair below what was in the development pipeline at the last construction peak before the recession.

There’s the “R” word — recession, of course. So we’re building almost as many apartments as we did before the economy tanked. But what about new home starts? How do they compare to levels from North Texas’ real estate hey day? Steve breaks it down in his story today:

Metrostudy reports that D-FW homebuilders started almost 6,000 homes in the second quarter.

They sold 5,127 houses – a 25 percent increase from second quarter 2012. The quarterly D-FW new home sales were at the highest level since 2008.

“It is likely homebuilders will start 22,000 homes in 2013, which is at the high end of our forecast”, said [Metrostudy's David] Brown.

But even with the big recent gains, home starts in 2013 will still be almost 60 percent below the peak of local building in 2006.

OK, that makes me feel a little better. We still have a ways to go as far as growing the market. Of course, if I wanted to temper my optimism with a healthy swig of facts with a chaser of statistics, there’s the Real Estate Center at Texas A&M University’s database to help out with that.

So, do you think we should remain only cautiously optimistic? Or is there a ceiling to our growth?

Coming soon (1)That Realtors group would be the North Texas MLS, or NTREIS as we call it. We know our market is hot. Buying a house in some parts of Dallas has never been like this before. There is only about a 3.5 month supply of real estate inventory in the North Texas market as of April. In some neighborhoods, there is even less. (Normal is more like 6 months.) Buyers are in competition against other buyers to snag a home. And so, things are getting gritty.

Veteran agents tell me they have never seen anything quite like it. Pretty soon they may even make a reality show about it: real estate hoarders.

“Agents are constantly calling each other to ask, what do you have coming up,” Dallas Realtor David Griffin told Steve Brown (paywall). “The idea is to build up a frenzy, so Day One when you begin showing it, you have a stampede of activity. In a blink, the house has a “sale pending” sign out front.”

Then there are buyers (with their agents) who tie up properties immediately with the option clause — consideration $$$ for the number of days a buyer is keeping a home off the market while they do due diligence. As some agents tell me, million dollar homes are being kept off the market for a few hundred dollars. Granted, the sellers keep the option funds if the buyer walks, considered chump change in this market, but it can choke out other buyers.

“Our earnest money is a joke in Dallas,” Lakewood agent Scott Carlson told Steve Brown (ditto). “You shouldn’t be able to put up a few hundred dollars and tie up a house. We’ve never had this in Dallas. We’ve just read about it in California.”

So now you get the picture. This competitive market, the polar opposite of what we saw about three years ago, has led to complaints and even worse, threats of lawsuits about the way agents may not be working for their clients’, THE SELLER’s, best interests. The biggest bulls eye is the hip pocket: off-market property transactions that are sold before ever making it onto the MLS.

I’ve always said the urge to nest is fierce! But on some highly desirable streets, “more than half of the houses are being sold by word-of-mouth or after “coming soon” signs (are) posted in the front yards. (Steve Brown, paywall) Real estate agents are quick to say that none of these questionable practices is illegal. But they say that anything that limits the marketing of a property or misleads a buyer or seller should always be avoided.”

I have heard that 10 to almost 20 percent of Dallas-area home sales, are now hip pocket transactions that never made it into MLS.

Cathy Faulkner, RCE, is Director of Multiple Listing Services for MetroTex Association of REALTORS® in Dallas. I spoke with her Monday — she talked to the North Dallas MLS on this very topic Tuesday morning. I suspect Cathy will be hitting every MLS in North Texas with her message: this hip pocket stuff is getting serious. Are we at critical level in North Texas, I asked Cathy?

“Not critical yet,” she told me, “but it could get there.”

Let’s look at the San Francisco Bay area for a minute to see the impact of pocket sales. Cathy was at an NAR meeting there in May, and the Bay area MLS reports that nearly 30% of their listings are being sold out of MLS. That’s almost one-third of the market!

The Bay area can track these stats because under California state law, all home sales must be publicly recorded. Thus they have tools to log home sales better than we can in Texas, a non-disclosure state.  If we were to lose one-third of all sales stats in North Texas, appraising properties would be a nightmare!

“We don’t know the effect this is having on our market,” says Cathy, “but we don’t think the agents and brokers participating in this process truly understand the ramifications.”

If they with hold the listing from the MLS, Cathy explains, agents are reducing the home’s exposure of presenting the listing to the highest number of potential buyers. Which means, they could possibly be missing out on highest price. There is no law that says agents MUST put their listing in MLS. Usually, it’s the seller’s call. MLS Rules and  Regulations require that listings taken within the boundaries covered by the MLS must be filed with the MLS unless the seller restricts the filing in writing.

“I have been trying to raise Realtor and broker awareness,” says Cathy. “We ask agents, what is your motivation for not putting this listing in MLS?”

Some sellers specifically want their homes left out of MLS for privacy issues (like a few sports stars I know) or for more control of the sales process.

“We don’t know what is going on in the listing presentation,” says Cathy.

During the presentation, the agent should go over all the advantages of listing the home in the MLS with the seller. There are a lot.

The MLS system was created by Realtors to cooperate and communicate the availability of properties. Put your listing in the NTREIS, 25,000 Realtors are paying attention to that home (or should be). Then Realtor.com picks it up, as well as all the aggregators out there — Trulia, Zillow, Redfin, any national websites the broker may participate in. That’s millions of eyeballs looking at your property. And if you have read this blog enough, you know it’s all about eyeballs. Maybe some California millionaire sees your home and falls in love? Keep the home out of MLS, and you have a limited networking group of say 25 to 100 agents who learn about the listing. This is why the limited exposure, if purposeful, could lead to potential lawsuits. Have there been any?

“I’ve heard the rumors,” says Cathy, “but have not yet confirmed. But there have been lawsuits in other cities. Any real estate market that has a pulse is fighting these same issues.”

Another thing for Realtors to consider: when you are dealing with a listing outside of the MLS, you may have no avenue to collect a commission if a dispute arises.

“The avenue may be through court,” says Cathy, “Which is one reason why this system was created.”

Then there is Fair Housing and potential Anti Trust violations. A Realtor’s networking group may be of one ethnicity. By not putting the home in MLS, you may not be exposing the listing to all ethnic groups, religions, all classes and statuses of people who might be qualified to purchase the property.

“Fair Housing complaints have been filed in other markets,” says Cathy.

The task force, which is composed of Realtors, has met once, is developing tools to help agents, brokers and the public deal with this issue fairly. TAR (Texas Association of Realtors) standard forms have a place for Seller to opt-out of filing the listing with the MLS, but the form does not have a place for Realtors to explain why a seller wants to opt out of listing his/her home in the MLS

Maybe it should.

 

 

 

 

 

 

Coming soon (1)That Realtors group would be the North Texas MLS, or NTREIS as we call it. We know our market is hot. Buying a house in some parts of Dallas has never been like this before. There is only about a 3.5 month supply of real estate inventory in the North Texas market as of April. In some neighborhoods, there is even less. (Normal is more like 6 months.) Buyers are in competition against other buyers to snag a home. And so, things are getting gritty.

Veteran agents tell me they have never seen anything quite like it. Pretty soon they may even make a reality show about it: real estate hoarders.

“Agents are constantly calling each other to ask, what do you have coming up,” Dallas Realtor David Griffin told Steve Brown (paywall). “The idea is to build up a frenzy, so Day One when you begin showing it, you have a stampede of activity. In a blink, the house has a “sale pending” sign out front.”

Then there are buyers (with their agents) who tie up properties immediately with the option clause — consideration $$$ for the number of days a buyer is keeping a home off the market while they do due diligence. As some agents tell me, million dollar homes are being kept off the market for a few hundred dollars. Granted, the sellers keep the option funds if the buyer walks, considered chump change in this market, but it can choke out other buyers.

“Our earnest money is a joke in Dallas,” Lakewood agent Scott Carlson told Steve Brown (ditto). “You shouldn’t be able to put up a few hundred dollars and tie up a house. We’ve never had this in Dallas. We’ve just read about it in California.”

So now you get the picture. This competitive market, the polar opposite of what we saw about three years ago, has led to complaints and even worse, threats of lawsuits about the way agents may not be working for their clients’, THE SELLER’s, best interests. The biggest bulls eye is the hip pocket: off-market property transactions that are sold before ever making it onto the MLS.

I’ve always said the urge to nest is fierce! But on some highly desirable streets, “more than half of the houses are being sold by word-of-mouth or after “coming soon” signs (are) posted in the front yards. (Steve Brown, paywall) Real estate agents are quick to say that none of these questionable practices is illegal. But they say that anything that limits the marketing of a property or misleads a buyer or seller should always be avoided.”

I have heard that 10 to almost 20 percent of Dallas-area home sales, are now hip pocket transactions that never made it into MLS.

Cathy Faulkner, RCE, is Director of Multiple Listing Services for MetroTex Association of REALTORS® in Dallas. I spoke with her Monday — she talked to the North Dallas MLS on this very topic Tuesday morning. I suspect Cathy will be hitting every MLS in North Texas with her message: this hip pocket stuff is getting serious. Are we at critical level in North Texas, I asked Cathy?

“Not critical yet,” she told me, “but it could get there.”

Let’s look at the San Francisco Bay area for a minute to see the impact of pocket sales. Cathy was at an NAR meeting there in May, and the Bay area MLS reports that nearly 30% of their listings are being sold out of MLS. That’s almost one-third of the market!

The Bay area can track these stats because under California state law, all home sales must be publicly recorded. Thus they have tools to log home sales better than we can in Texas, a non-disclosure state.  If we were to lose one-third of all sales stats in North Texas, appraising properties would be a nightmare!

“We don’t know the effect this is having on our market,” says Cathy, “but we don’t think the agents and brokers participating in this process truly understand the ramifications.”

If they with hold the listing from the MLS, Cathy explains, agents are reducing the home’s exposure of presenting the listing to the highest number of potential buyers. Which means, they could possibly be missing out on highest price. There is no law that says agents MUST put their listing in MLS. Usually, it’s the seller’s call. MLS Rules and  Regulations require that listings taken within the boundaries covered by the MLS must be filed with the MLS unless the seller restricts the filing in writing.

“I have been trying to raise Realtor and broker awareness,” says Cathy. “We ask agents, what is your motivation for not putting this listing in MLS?”

Some sellers specifically want their homes left out of MLS for privacy issues (like a few sports stars I know) or for more control of the sales process.

“We don’t know what is going on in the listing presentation,” says Cathy.

During the presentation, the agent should go over all the advantages of listing the home in the MLS with the seller. There are a lot.

The MLS system was created by Realtors to cooperate and communicate the availability of properties. Put your listing in the NTREIS, 25,000 Realtors are paying attention to that home (or should be). Then Realtor.com picks it up, as well as all the aggregators out there — Trulia, Zillow, Redfin, any national websites the broker may participate in. That’s millions of eyeballs looking at your property. And if you have read this blog enough, you know it’s all about eyeballs. Maybe some California millionaire sees your home and falls in love? Keep the home out of MLS, and you have a limited networking group of say 25 to 100 agents who learn about the listing. This is why the limited exposure, if purposeful, could lead to potential lawsuits. Have there been any?

“I’ve heard the rumors,” says Cathy, “but have not yet confirmed. But there have been lawsuits in other cities. Any real estate market that has a pulse is fighting these same issues.”

Another thing for Realtors to consider: when you are dealing with a listing outside of the MLS, you may have no avenue to collect a commission if a dispute arises.

“The avenue may be through court,” says Cathy, “Which is one reason why this system was created.”

Then there is Fair Housing and potential Anti Trust violations. A Realtor’s networking group may be of one ethnicity. By not putting the home in MLS, you may not be exposing the listing to all ethnic groups, religions, all classes and statuses of people who might be qualified to purchase the property.

“Fair Housing complaints have been filed in other markets,” says Cathy.

The task force, which is composed of Realtors, has met once, is developing tools to help agents, brokers and the public deal with this issue fairly. TAR (Texas Association of Realtors) standard forms have a place for Seller to opt-out of filing the listing with the MLS, but the form does not have a place for Realtors to explain why a seller wants to opt out of listing his/her home in the MLS

Maybe it should.

 

 

 

 

 

 

Jeff Dworkin DMN jan 2013

Photo courtesy of Kye R. Lee/Staff Photographer, Dallas Morning News

I think we’ve been saying this in so many words for a few weeks: our market is doing better, much better, and now even Steve Brown my “Debbie Downer” NAREE colleague at the Dallas Morning News is paying attention: He’s even saying our homes (all of them?) may soon cost more:

“North Texas homebuyers are going to have to dig deeper to pay for a new house. And even if they can swing the bigger price tag, finding an available property won’t be easy. A growing shortage of undeveloped land and lots in many new home neighborhoods and rising construction costs will mean significantly higher prices in the Dallas-Fort Worth area this year and in 2014.”

Then I just got off the phone with Steve’s photo star, builder Jeff Dworkin, a CandysDirt approved builder (all hand selected because I know the quality of their work: Jeff, Michael Turner of Urban Classic Homes, Mickey and Michael over at Shariff-Munir, Mark Danuser at Tatum Brown, Tom Greico, Marc Kleinman, Dennis Mullinix, Matthew Thomas, these are the good guys) who confirmed the home in the photo, 7231 Coronado, will be completed later today but sold weeks ago prior to completion at $530k. Unreal price. But that’s the story everywhere. And he thinks the home would have sold for $20 to $30K more had he put it in MLS.  (He has another one going up two blocks from Coronado, so holler at Jeff if you are interested.)

Jeff is in Vegas today at the National Home Builder’s show but has to come back before it ends because he’s closing on two more homes Friday morning. The home builder’s problems, if we can call them problems, are what Steve outlined and I’ve been telling ya –

-Home inventory (pre-owned) in Dallas is down to a four month supply of pre-existing. Six months is normal. It’s even less in Austin — 3.3 months!

-Builders stopped building specs after 2009, and banks stopped lending money for specs so, as we predicted, specs became a hot commodity.

-The supply of vacant lots is down by 40% in Dallas/Fort Worth.

-Building materials are costing more: wood, concrete, roofing materials (because almost everyone in North Dallas got a new roof courtesy of last springs’ hail storm), plumbing, concrete.

-Skilled labor is at a premium. As Jeff and my other builders told me months ago, the number of home builders in Dallas has been chopped by almost half of what it was before the recession. The work went away, so many subs turned to other careers. Today’s home builder needs loyal subs.

Michael TurnerI had lunch with Michael Turner of Classic Urban Homes last week, and I was lucky to get the man to sit down for 30 minutes, that’s how busy he is: six customs under construction, three in the design stage.

“It’s like someone flipped on a light switch 6 months ago, ” he said. Whereas Jeff might be selling to younger families in East Dallas wanting a new home for around half a million, Michael’s Classic Urban gets 80% of their calls from people in Park Cities, Preston Hollow and Bluffview who want to downsize to about 3000 square feet, or what one of my dear friends calls a “lock and leave”. But they still want those homes loaded.  Michael says three things are driving all this new construction: low interest rates, pent-up demand from the last four years, and the herd mentality.

That’s not to say he is not also selling to younger what we once called DINKS, double income, no kids.

“People in their mid thirties, young professional couples, both working” says Michael. “they are wanting new, a modern, contemporary home they plan to stay in longer. We are trying to keep up with the demand.”

A few consumer trends Michael sees: engineered wood flooring is hot, stainless steel still rules in the kitchen, greener countertops like Silestone and Cesaerstone are running neck to neck with granite, a “flex room” which can be a study/office/craft room combo, and the end of the living room as we know it.

“The formal living room is dead,” says Michael. “And people are also giving up media rooms.”

Contemporary design, however, is here to stay, he says.

Builder Leo Savino of Significant Buildings and Construction agrees that contemporary is not just hot, it’s here to stay. He, too, is finding building lots as scarce as a needle in a  haystack. In fact, now he has several commissioned remodeling projects for some clients who choose to stay in their current home lot and make, well, Significant improvements to it.

“I have a client in the Park Cities who loves, loves, loves her street and never wants to leave,” says Leo. “So we are doing a major interior remodel, going contemporary and larger in a 1920′s house.”

If you are thinking of building, one thing you DON’T want is a builder who beats on his subs too much for pricing. Such a builder may find himself without subs in this heating up market.Significant