Well yes, it’s not even mid-April and it’s a mad house out there in the inner-loop real estate world. Sales of pre-owned single-family homes in March rose 22 percent from 2012. 7,483 properties sold. That’s the highest number of home sales since March, 2007.
And we all know what happened after 2007.
Hot discussion Wednesday over at the Oak Lawn MLS, I hear, on Hip Pocket sales. Agents are selling homes off of “Coming Soon” signs. Ever think you’d see the day? Property values are inching up, too. According to the all-knowing Real Estate Center at Texas A&M University, median single-family home sales prices were 8 percent higher last month than in March 2012. We may be feeling real estate rich again: in mid-2007, before the recession hit, median Dallas home sales prices were $168,000.
And of course, everyone is scratching their heads wondering, what the hell happened? As Michael Turner of Classic Urban Homes told me, come January, someone turned on a switch in the real estate market. Dr. James at the Real Estate Center calls it a “double-whammy” —
“Part of the increase is from demand growth, part is from the short inventory of available properties,” said Dr. James Gaines, Real Estate Center economist.
I will add this: low interest rates are helping a whole lot.
Home sales through the MLS are up 19 percent from first quarter of 2012. Folks, that’s almost one-fifth. At the same time, there are fewer homes on the market: total inventory of for-sale homes in North Texas at the end of March was down 22 percent from a year ago. There is about a 3 month inventory, when 6 months is normal.
But the number of homes on the market in the Dallas-Fort Worth area is at the lowest level in more than 20 years, according to the Real Estate Center.
Over at the Ebby Halliday Companies, all-time sales records for both the month of March and the First Quarter of 2013 have been set reaching an all-time high. Closed real estate transactions of more than $550 million in March alone reflect an increase of 47% over March 2012. That’s nearly TWICE the number of sales in 2013 over 2012.
Ebby says closed sales add up to more than $1.1 billion in the first quarter of 2013, an increase of 34% over the first quarter of 2012. There are 1400 Ebby agents, making the firm the largest independent real estate brokerage in North Texas.
You have to wonder: if the market is so strong, interest rates are low and home prices inching north, why aren’t more people listing their home?
Steve Brown posed this question to George DeCourcy, associate director of the real estate program at the University of Texas at Dallas. DeCourcy said it will take more than price increases to cause a big jump in homes on the market.
“Prices have come back, but not like a bull,” DeCourcy said Monday. “People feel there is no compelling reason they should move at these prices.
“I think you will have to see significant move-up from here before people decide to list their homes,” he said.
Also, many homeowners are stuck in rental contracts as they filled their homes to create an income flow a few years back. Some homeowners have refinanced at near record low mortgage rates, and it’s pretty cheap living. If prices escalate, it may not make sense to sell and buy another one, which will be more expensive, too. Then since there is a shortage of homes to buy anyhow, so where will they go?
One group may benefit from this: the downsizers selling large homes and buying less. But again, good luck finding product!
Then there are the Hip Pockets, those private transactions that never go into MLS. Experts are saying that as many as 30% of sales are hip-pocket deals, and I have also heard that’s about the number going at each of the four top brokerages. Talking to Ginger Nobles with Briggs-Freeman Sothebys the other day, she said she has never seen a market like this one.
“I have been in real estate for more than 30 years, and I have seen everything,” says Ginger. “But homes now are selling before you can get them into MLS!”
Agents are even instructing clients not to discuss potential listings they are “eyeing” publicly lest they be swooped up by another agent and buyer. It’s like, mum’s the word until that contract is signed and the ink is dry!