In the eyes of the latest S&P/Case-Shiller housing report, which indexes existing (not new) home sales in 20 major U.S. cities, it’s 2003 when it comes to housing prices. That’s good news. We are told the average U.S. home price in July rose 1.6%, this compared to the previous month, marking the third straight month that prices in all 20 major markets followed by the index improved. And had it not been for a slight spring decline in April, it would have been the fourth straight month of real estate price improvement across the full spectrum.
Blame Detroit, in April.
The index was up 1.2% compared to a year earlier, an improvement from the year-over-year change reported for June. Home prices have been showing a sequential change in recent months, but it wasn’t until June that prices actually marched higher than a year earlier.
Since the July numbers match levels last seen back in summer 2003, when the market was racing towards it’s 2006 peak, experts speculate whether we could be heading into another housing bubble aka the financial crisis of 2008.
No, they say: the market may not be as dismal as it was, but lending practices are much tighter than they were pre 2008. Also, there is still a reluctance by many to get into the market — or a lack of down payment cash, underwater mortgage. Those who are taking advantage of the lower prices are cleaning up on foreclosures and other bargains, becoming landlords. It will take many years before we see a steady, significant appreciation.
But you know my mantra: real estate prices are a totally local story. Dallas home prices are basically steady as she goes and oh so healthy: 3.7% higher than they were same time last year. Last week, appraiser Brian Hagan spoke to a select group of agents over at one of Becky Frey’s gorgeous listings, the penthouse at 4611 Travis Street, for the low-down on the UP, HP and Preston Hollow markets. Take-away: University Park is so hot with multiple offers and swept up inventory, homes are tough to find. Highland Park, less so because you have pricier homes and a lot of private, off the record sales. Preston Hollow land sales are up again, and lot prices are creeping up south of LBJ, too.
“In Park Cities, University Park, I’m feeling more like 2008,” said Brian. “Multiple offers, land values up 20%.”
Luxury home builder Robert Elliot is moving the University Park market with 28 lots, and his homes are selling before completion. East of Hillcrest, even the smaller lots are hitting $80 per square foot or more, this increase in just over a year. There is no over supply of building in UP, he says. In the honeypot estate area, acres are going for $1.5 to $1.7 million per for prime properties, this compared to the peak of $2.6 per acre in 2007.