Rock bottom prices + low interest rates= SOLD!Posted by Emily Ray-Porter on Wednesday, July 28th, 2010 at 10:36am.
Bargains, low mortgage rates boost Dallas-area home sales in 2010
10:38 AM CDT on Friday, July 23, 2010
Home sales and prices were up in the first half of the year in most Dallas-area residential districts.
The big question is: Will it last?
Some real estate agents who pound the streets representing buyers and sellers say business is still pretty good – even without the federal tax credits that fueled so much homebuying earlier this year.
"I'm written a ton of contracts in the past 2 ½ weeks," said Scott Schueler of Keller Williams Realty. "The bulk of my business right now is first-time buyers."
The tax credits, which ran out at the end of April, were especially appealing to those first-time buyers. But finance rates at near-record lows are keeping them interested.
"The low interest rates are appealing to everybody," said Lydia Player of Virginia Cook Realtors.
Player said worries about the economy are being trumped by bargains in many neighborhoods.
"People are still feeling a little uncertain about the economy," she said. "But there are so many good deals out there, they can't pass them up.
"The prices of the properties right now are as good as we are going to see," Player said. "The general feeling is we have hit rock bottom."
Prices are starting to rebound. Median home sales prices were up in the first half of 2010 from a year ago in all but a dozen Dallas-area residential districts tracked by The Dallas Morning News. Overall prices in the area were up an average 7 percent from a year earlier.
Some of the biggest gains were in Oak Cliff, up 22 percent, and Westlake, up 10 percent.
The biggest jumps in the number of home sales through the real estate agents' Multiple Listing Service have come in high-price housing areas including the Park Cities, Westlake and North Dallas.
"Last year's figures for the areas were so low, any increase at all is magnified," said longtime agent Barry Hoffer of Ebby Halliday Realtors.
Hoffer said that as the summer has progressed, he's seen a bit of a pullback in some neighborhoods.
"My take is that the market has slowed in recent months from the modest spring recovery," he said. "I also noticed that the number of homes for sale at the end of June was higher. This is another indicator of a slowdown in home sales."
Home sales are still down this year in Cedar Hill, DeSoto, Lancaster and southeast Dallas. Those areas were hard hit by subprime mortgage defaults and have yet to recover, said housing analyst Ted Wilson of Residential Strategies Inc.
"As a result of the higher foreclosure rates, pressure has been applied to both housing prices and inventory levels," he said.
Although the local housing market has improved from a low point last year, there are still obstacles, agents say.
"Even though the mortgage rates are really low, loans are hard to get and money is tight," Player said. "Even very high-credit-quality buyers are taking longer to close on loans, and they are required to jump through more hoops."
And if the property you are selling has a few dings, be prepared to slash the asking price.
"If you have a house that needs a lot of work, you are going to have to drop your price substantially," Schueler said.
Even if interest rates stay low, home sales could be lower this fall compared with a year earlier, Wilson said.
"Sales figures in the second half of 2009 were artificially inflated due to the first-time homebuyer tax credit that was in play at the time," he said. So don't be surprised "if we fall slightly short of the activity we experienced last year."
The broader gains in the North Texas economy should keep the housing market from losing too much steam, he said.
"I'm hopeful that the slug of net new jobs that have been created over the past five months in D-FW will lead to a steady housing recovery in the months ahead," Wilson said.