I am hearing it from agents and sellers, I am hearing it from appraisers and title companies: people are buying homes again (like these) in Dallas. Numbers are the proof: The Texas Association of Realtors said Tuesday that home sales in the state were up 12 percent in the first quarter from the same period in 2011. You know what happens when homes start selling: you get comps, and then prices creep up. Statewide, median home prices in the state were 3 percent higher than a year ago.
Texas Realtor chairman Joe Stewart told Steve Brown the year is shaping up to a very positive momentum:
“In 2012’s first-quarter results, we see a strong increase in sales volume and a meaningful increase in the median price,”
Texas has an average of a 6-month supply of homes on the market, down from 7.6 months in first quarter 2011, and 6 is considered normal and balanced. The good news (for sellers) is that our home inventory has been decreasing for months. That’s not necessarily good news for buyers: home inventory was down 23 percent in the first quarter of 2012 from 2011. You know the reasons, but according to Dr. James Gaines, an economist at the Real Estate Center at Texas A&M University, some homeowners who don’t have to sell have chosen to wait for prices to improve before selling their homes. Or they leased them. There are also fewer distressed properties in Texas.
Now here’s what keeps me awake at night: people being able to afford mortgages or rents. Rents are rising and as one developer told me, the banks are tripping over themselves to lend money to anyone who wants to build an apartment complex. This leaves fewer affordable properties on the market. Realtor Tom Branch tells me he had MLS run numbers for properties under $200k in Collin County– there is only 3.1 months of inventory! Though I have to pack lunch and maybe even an overnight bag when I go up there, agent Brad Holden tells me there is no stopping Frisco. Since February/March of this year, there have been already around 48 contracts in Richwoods, and there are 8 to 10 lot holds. On top of that, Landon Homes has filled up their first set of available lots in the 64’s and 74’s and they have a combined total of 18 or 20 checks for when then next set of lots are released to write a contract! Landon started selling in the beginning and they have already had a $5,000 increase in prices across the board. On May 1st they plan to raise them another $5,000, another $5,000 on May 21st. (Jesus that’s $15,000!) Brad speculates they need to slow the contracts down because they can’t get that many permits from the city. What a problem to have. Newcastle Homes has sold a couple and plans to build 6 specs in the $550,000 plus. Toll Brothers were last to release pricing and have sold two with two more lot holds, and KHOV had only eight lots in the first section. Only one of those is still available as of yesterday.
Why, I asked Brad, and I ask you, is everyone suddenly buying? The national economy still sucks. Is it the pending election? Brad says number one reason up north is pent up demand and the location/schools combo.
What do you think?