Thanks to Steve Brown for the following news. Follow @SteveBrownDMN
I am beginning to understand how the winter weather can sometimes affect the economy of the northeast United States. Just a couple inches of snow mixed with some sleet and ice this week seemed to put Dallas area potential buyer prospects in hibernation mode. Property tours were delayed, and Dallas Morning News real estate guru Steve Brown’s address to the Dallas Builder’s Association was cancelled – merely postponed to next month, I hope.
Let’s hope that sunshine and warmer weather bring out more sellers this spring. Culture Map reported that Dallas area residential homes for sale inventory this January was 30% below last January. Wowzer.
Also, Dallas may be taking the mantle from Houston now as the hottest residential real estate market in Texas. Realtor.com touts Dallas as the second hottest real estate market in the country, just behind Waco, Tx. Waco? Yes, Waco, in terms of number of page views per listing online at Realtor.com.
Days on market for Dallas homes now is 62 days. That’s the lowest in Texas and 41 days shorter than the national average of 103.
The Dallas market has held up well to the oil price slump. Low oil prices may have begun to cool the Houston real estate market a bit, as Baker Hughes reported global rig counts at 2,986 in February, down 20% from a year ago. Commodities traders seem to think oil will rebound in the future, as January 2016 futures priced West Texas Intermediate crude at 19% above today’s spot price.
With oil storage facilities beginning to fill, however, some believe that oil prices will fall further in the immediate future.
The Energy Information Administration reported weekly crude inventories rising at 10.3 million barrels. It also reported that the 82 million barrels of U.S. storage capacity was already 60% full. That doesn’t seem alarming until you consider that last week, crude inventories rose at 10.3 million barrels. That was 3 times official estimates. Despite fewer wells in action, production continues to rise, as exploration companies focus on their most efficient wells.
Despite the above, Houston had the highest year-over-year home price increase in January according to Dallas-based analytics firm, CoreLogic. Houston led the nation with a 10.9% increase, and Dallas was second with a 9.1% increase. Dallas home prices rose by just under 10% in 2014, more than double the annual average.
(CoreLogic is also on the hunt for new corporate digs in north Texas. Some say it could be up to 300,000 square feet.)
The torrid home price increases have left most of the millennials behind, as fewer of them opt-in to home ownership. Only 56.3% of Dallas area homes are owner-occupied, which is among the lowest ownership rates in the nation. It’s no wonder that Dallas – Fort Worth is one of the top apartment development areas as millennials are settling down later, and love to travel.
The average age of a Texas home buyer last year was 45 years old and 72% were married. First time home buyers accounted for only 29% of the Texas market. The median household income for first time buyers was up more than 5% at $72,000. 28% of the homes sold last year in Texas were new homes, as Texas leads the nation in home building.
Speaking of new homes, David Weekley Homes is teaming up with Southside on Lamar developer Matthews Southwest to develop 40 homes on an almost 2-acre tract in the South Dallas Cedars area. It will be interesting to see how the continued development of the area south of downtown Dallas takes root.
The Dallas – Fort Worth office market is booming. Vacancies are at lows not seen since the 1980s. Office construction is second in the country, only trailing Houston. See the Dallas – Fort Worth office market statistics in this great chart by the Dallas Morning News. Job growth along with more looming large corporate relocations are fueling the office sector.
Dallas – Fort Worth industrial and warehouse leasing and development activity is at highest levels since the recession. North Texas warehouse vacancies are in the 5% range, a historical low.
Movie theater chain operator Cinemark Holdings Inc. has bought its 5-story headquarters building at 3900 Dallas Parkway in Plano.
Fort Worth-based Trademark Property has been tapped to renovate the Shops at Highland Village in Denton County. They are also the firm behind the makeover at the American Airlines Victory Park retail center.
Let’s look forward to another great week in Dallas real estate. If we can answer any of your real estate questions, we would love to help. Reach me directly at 214-690-9682.
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