The indicators are liking Dallas more and more, and we are getting a reputation around the country for being pretty hot stuff — in our real estate market, that is. According to the latest CoreLogic report, Dallas-area home prices in February were up 7.3 percent from a year ago, February 2011, this in CoreLogic’s latest nationwide price comparison.
And then if you do what CoreLogic does so well, take out distressed sales, values shot up 9.5 percent.
That still skirts the overall national increase of 10.2 percent, the biggest increase in about seven years, but I’ll take 9.5 percent anyday. We have not seen home prices increase this much in seven years.
Markets seeing the best price increases were in markets that were wiped out by the Great Recession, which really started because of housing. We call them the Sand States: Nevada, where prices shot up 19.3 percent, Arizona which is back from the dead, prices up 18.6 percent, and Miami 9.5%, all those out-of-country buyers. But look at California — up 15.3%, and even Idaho up 15.3%, while Hawaii rocked it at 15.5%.
Yep, paradise is getting more expensive. Prices in Nevada are still 50 percent lower than they were before the housing bust — which is a good thing!
If you are house shopping, or looking for a house, CoreLogic predicts the double-digit home price gains will continue. The firm is calling for a 10.2 percent nationwide increase in home values for March. Here in North Texas, home values are up about 8 percent according to the various multiple listing services. And I’ll tell you that new homes are going to see price increases like a Texas tornado. Come June 1, the cost of lumber is going up, Jeff Dworkin of JLD Custom Homes tells me, because of a lumber span charge. Builders have to use 2 by 8’s, not the 2 by 6-inch boards they have been using. This will affect spacing of studs — either closer spacing or bigger studs. This means when framing a house, there will be more wood in that frame, which will take a framer more time to frame, meaning more to pay your framers, which trickles down to price increases of 10 to 15% per new home built.
“I have 2 or 3 people who called me last summer, they were on the fence,” says Jeff, “Now they are ready to pull the trigger but I tell them, it’s a different world. It’s 10 to 15% more now to build than it was last summer, and that doesn’t include the price of land.”
Which, according to CoreLogic and MLS is about 9% more expensive than it was last year.
So there you have it: Jeff says that the buying floodgates opened after January, with record low interest rates, once the election was over, once we realized the world was not going to end on the fiscal crisis. People had jobs, got loans, got a house.
At least, that’s what happened in Dallas.