Clear Capital, a California-based housing and finance analyst, says we can be downright proud of our market: Dallas-Fort Worth home prices will rise by another 1 percent during the next six months.

The good news: more markets are improving than not, should sustain the slow winter and come out with a roar come spring. In fact, Clear Capital says home prices are increasing in most major U.S. markets.

The Dallas forecast — the whole area — is a little less than a 3 percent gain seen in some other markets. But I never fret about this for several reasons:

One, real estate is such a local story it isn’t even funny. Values can differ on the same street! Our Park Cities and Preston Hollow markets are sizzling — talked to Dave Perry Miller this morning, he sold a Dilbeck on Strait Lane before it even came on the market. I’m having lunch with Brian Hagan, so stay tuned.

Clear Capital figures D/FW home prices have risen just over 2 percent in the last year, which is less than a nationwide average of 4.74 percent.

But if you look at Phoenix, where home prices are up 27.7 percent, you are not talking apples to apples. Phoenix prices more than plunged — I mean they were in the gutter! — and many homeowners are still underwater out there. Poor Providence and Atlanta — Rhode Island’s capital is down by 5.2 percent, and Atlanta is down 1.2%. Reason? No jobs.

Still, if you bought low in Phoenix, this may be a good time to sell. Which brings me to my next point: don’t get all giddy and break open the Veuve Cliquot just yet. One of the reasons our markets are doing so well is tightness from the banks and a piddly inventory. What’s going to happen? As news like this comes out, more folks will pop their homes on the market and inventory will puff up — once again tempering prices.

What about low mortgage rates, surely those are helping? Economists at Capital Economics even envision a possible decline to 3.3 percent, which could bring out even more home buyers. Still, these guys say “the bottom line is that housing is unlikely to become a significant driver of GDP growth.”

Why not? Housing makes up too small a portion of GDP to have a major impact. Residential real estate investment made up only 2.4 percent of GDP in the second quarter of this year. That’s just half the long-term average, and well below the 6.3 percent peak recorded at the end of 2005. I mean, people will invest in modest homes, if they can obtain financing. But most of the sales volume is coming from the affluent communities.

“The cumulative effect of the past five consecutive quarters of residential investment growth has been a 0.2 percentage point rise in annualized GDP growth.”

And then there’s the big fat elephant in the room, unemployment above 8 percent. Middle class folks cannot buy homes without jobs, steady jobs. The banks right now don’t like the self-employed.

Don’t get me wrong — I’m happy everyone’s happy and homes are moving at long last. Moving vans are happy, Realtors are happy, even the Home Depot is happy because no one spends money quite like a family who has just moved into a new home.

But keep the good champagne on ice until we see job growth and a serious dip in the unemployment rate.

 

 

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.