| Bouncing Back: Texas Real Estate
Written by Tavaner Bushman
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3548 Bryn Mawr in University Park, Dallas, Texas As the saying goes, what goes up must come down. Unfortunately the reverse is not always true; what descends, does not always come back up. But lucky for us here in Texas, residential real estate values did not decrease nearly as much as the rest of the country. In fact, the Texas real estate market has stayed relatively healthy. If that is not enough to be thankful for, it looks like the market is on the rise – in October 2009 in Austin, according to the Multiple Listing Service report by the Austin Board of REALTORS®, 1,823 homes were sold, up 38 percent from October 2008. Although the median home price in Austin decreased five percent to $182,000 from 2008 to 2009, the overall dollar volume increased 35 percent to $434,975,092. Sales volume in Austin was down in early 2009 compared to 2008. However, since July 2009 the local market has reached a similar sales volume to the corresponding month the previous year. “Sales volume like this is similar to what we saw in 2005, which is an encouraging sign,” says Jay Gohil, 2009 Chairman of the Austin Board of REALTORS®. “It’s possible some of this surge in volume was related to the original deadline for the first-time homebuyer tax credit, so it’s good for our market that the tax credit was both extended until April and expanded to include more current and prospective homeowners.”
3548 Bryn Mawr in University Park, Dallas, Texas In Dallas, realtor Jennifer Miller of Dave Perry-Miller & Associates - who specializes in the Park Cities, Preston Hollow and surrounding neighborhoods - has seen an increase in listings going under contract and closing since September 2009. According to Miller, many sellers have adjusted their prices to make listings more attractive, which results in multiple offers. One recent showing received nine offers/contracts for the three days it was on the market. At the worst, Miller’s inventory backed up because things weren’t selling, but she and her clients tested the market and the “market spoke.” Once prices were reduced, properties sold. “I believe in what I refer to as ‘The 15 minutes of fame for a new listing.’ You need to have the home in the best showing condition and priced correctly when you go onto the market because the first 30 days is when you typically get the most activity on a property. That has always been my philosophy/strategy even in a good market,” says Miller. An increase in lending has also helped relieve the stalemate – Miller always had willing buyers wanting to purchase her listings, but they were having difficulty securing funding. In addition, Texas draws many people and companies from out of state. Austin, San Antonio, Dallas, and Houston thrive from jobs in industries that are stable and/or growing. Companies and individuals move to Texas for tax benefits, the relatively mild climate, and a lower cost of living and of doing business. In addition, Austin, San Antonio, Dallas, and Houston have flourishing arts, fine dining, culture, easy access to airports, reasonable housing prices, and a choice of a laid back, sophisticated, or hybrid lifestyle.
10731 Bridge Hollow Court, Dallas, Texas Fortunately, the price bubble was never as bad in Texas as it was elsewhere, so our prices haven’t significantly fallen by comparison, says Peter Ryan of Briggs Freeman Real Estate Brokerage in Dallas. Their sale prices have been flat or slightly higher in each of the last four months, and local Dallas sales were up 11 percent in October from 2008. One of the reasons for Dallas’ relative price stability is that inventory remained fairly stable during the downturn. Dallas has a six-month supply of inventory, which according to Ryan, is balanced. At the end of October, 33,981 homes were listed for sale in Dallas. There wasn’t the profusion of homeowners putting their homes on the market in a panic as was seen in other areas of the country. Sellers are becoming more realistic about the real value of their properties in today’s environment and are pricing them accordingly, says Ryan. When priced as they should be, Ryan has seen several well-priced properties receive multiple offers when they come onto the market. People are looking and people are buying. The average number of days on the market for a home in Dallas is 76—a six percent decline from a year ago. “Buyers are looking for good value. Prior to the downturn, buyers were looking for move-in ready properties. Now, they don’t mind having to do some work on a home as long as they feel they have received value,” says Ryan. In addition to a willingness to make improvements, buyers are really thinking about their purchase. “I would say many people are buying from a more analytical view than the emotional buying they used to do when the economy was stronger,” says Miller. One thing is for sure, buyers are purchasing homes with a long-term vision of owning and growing in a home, which makes them particularly discriminating. “Short-term investments and flipping a house in two years are a thing of the past,” says Ryan. It may have taken fear and a slight downturn to get us here, but the Texas real estate market seems to have arrived at quality versus quantity equilibrium, which in the long run is much more sustainable. Both Ryan and Miller are looking forward to an upbeat Spring 2010 market. Ryan anticipates a pent-up demand from buyers, and is ready and raring to go when the crowd comes. TH&L
Jennifer Miller
Jay Gohil
Peter Ryan
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