Investors and first-time buyers are powering real estate sales in the low price points in the Dallas-area market, say real estate agents Mary Beth Harrison and Brian Rayl, and for-sale inventory has declined.
Harrison and Rayl participated in an Inman News Q-and-A.
Dallas Real Estate Market Q-and-A
1. Describe which types of properties are selling fastest in your market area.
HARRISON: Single-family homes priced from $50,000 to $170,000.
RAYL: Properties below $100,000 have been selling the fastest in the Dallas-Fort Worth market. I attribute much of this to real estate investors who are coming in and picking up good deals in order to flip or rent for profit. Investing has become a huge market here.
2. Describe which types of properties are selling slowest in your market area.
HARRISON: Single-family (homes priced at) $600,000-plus, and also farm and ranch (properties), followed by multifamily.
RAYL: Homes priced over $250,000 have been selling the slowest, although they have seen a dramatic decrease in time on market. A year ago, you could expect a home priced over $250,000 to sit on the market an average of 145 days. Today, that number is down to 120, a decrease of nearly 20 percent.
3. Describe any changes in the demographics of buyers and sellers in your market area.
HARRISON: Investors continue to be strong, driving the $50,000 to $100,000 sales
RAYL: A large part of today’s real estate environment in Dallas is foreclosures. We are seeing a huge influx of real estate investors — local as well as national and international investors — coming into the Metroplex to purchase great deals.
4. Describe the level of activity among first-time buyers in your market area.
HARRISON: First-time buyers are very strong in our market, driving the $100,000 to $200,000 sales
RAYL: First-time homebuyers have come out of the woodwork looking for great deals, but many of them are not realistic about their home search. All they hear is the state of the economy and expect to purchase a home for significantly under list price.
In today’s market, more than ever, significant education is needed, and it is needed at all levels of homebuyers — not just first-timers.
5. Describe the level of activity in the luxury market in your area.
HARRISON: Luxury sales are strong, but inventory is still high. It represents triple-digit sales for the year vs. (four-digit) sales (among properties priced at) $499,000 and below.
RAYL: The luxury market has definitely picked up over the past year. Much of this has to do with the realization by the homeowners of what the current market is and beginning to price their home realistically. Financing has never been an issue for this market. It has always been about confidence and price.
Dallas Real Estate Market Data
|# closed home sales (2011)||64,509|
|# closed home sales (2010)||64,423|
|% change closed sales (2010-11)||0.1%|
|# closed home sales (for most recent month or quarter available)||3,572|
|# closed home sales (for same month or quarter one year earlier)||3,311|
|% change closed sales (most recently month available in 2012 vs. same month in 2011)||7.8%|
|Median sales price (most recently month available in 2012)||$145,000|
|% change sales price (most recently month available in 2012 vs. same month in 2011)||-2%|
|% share of distressed properties (most recent month available)||25.6%|
6. Describe recent trends with home prices, sales and inventory.
HARRISON: Inventory is down (below a six-month supply in many areas), and prices are climbing in those areas and flat to rising in the others. There are not many decreasing areas.
RAYL: During the spring and summer of 2011 we certainly saw the normal influx of listings. What was unusual was that during the fall and winter months we saw much more activity than usual. Our current inventory sits at around eight months of supply for the Dallas-Fort Worth Metroplex as a whole. We have not seen inventory this low since 2008.
7. Describe the current state of the distressed property market in the area.
RAYL: Foreclosures account for approximately 25 percent of today’s real estate transactions here in Dallas. Banks are trying to unload their inventory and are realistic about their prices in most cases.
8. What worries you most about the current state of the market?
HARRISON: The difficulty in getting loans, real estate owned (REO) inventory that banks might be holding, and the election year.
RAYL: My worry is that interest rates will begin to climb before the housing market truly recovers. Add on top of that the continued flow of bank foreclosures into the marketplace and you have a recipe for a continued anemic real estate market for the near future.
9. What represents a sign of optimism and opportunity for the real estate market?
HARRISON: Lower inventory, rising interest rates, job stability and growth, and good weather have helped make January and February great months.
RAYL: Those who have considered investing in real estate have never had a better opportunity to dip their toes into the water with the deals that are available in today’s market. On top of that, those who are looking to refinance their current home or purchase a new home can do so very cheaply and inexpensively.
You can afford to purchase 25 percent more home today than you could a year ago and have the almost the exact same mortgage payment. That says a lot.
10. Describe the overall economic health in your market area.
HARRISON: Dallas has maintained a much healthier economic climate than most and it continues with good population growth.
RAYL: The economy in Dallas is thriving. Job creation continues to be a big economic driver. As the home to several Fortune 500 company headquarters, the Dallas area has always had a fantastic job outlook and will continue to for the foreseeable future.
In addition to this, the fact that Texas does not have a personal income tax offers a big incentive for both blue-collar and white-collar workers to choose Texas as the home for their business and/or their families.
Mary Beth Harrison, a Realtor for Keller Williams Realty, has worked as a Realtor since 1990. She sells real estate in Dallas and the surrounding areas. Her website is www.DallasNative.com.
Brian Rayl is a Dallas real estate agent who works for Keller Williams Elite – Park Cities. Find out more about Rayl at: http://BrianRayl.com/about. Rayl provides real estate services in Highland Park, University Park and all of the North Dallas area.