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Date Posted: 14:03:12 07/26/17 Wed
Author: Fort Worth Business Press (More info on prices)
Subject: Re: Homes on fire: Sales, prices climb to new record levels
In reply to:
's message, "Homes on fire: Sales, prices climb to new record levels" on 13:08:26 07/24/17 Mon
Rising prices in major metro areas across the country has boosted the median home price above the peak value of $196,000 at the height of the housing bubble a decade ago, according to Zillow.
In Texas, median home prices grew 5.45 percent from $220,000 in June 2016 to $232,000 in June 2017, reaching a record high last month, according to data from the Real Estate Center at Texas A&M University.
While some sellers are giddy over the prices their homes are fetching, the downside is that Texas’ top metro areas are becoming increasingly unaffordable for middle-income and first-time homebuyers.
A combination of stagnant wages and house price appreciation has strained home affordability across the country, but the problem is even worse in Texas, where wages remain below the national average and housing prices are rising faster than the U.S. average, according to a statement from the Texas A&M Real Estate Center.
“Tight inventories dragged total Texas housing sales down 5.9 percent in April,” said Texas A&M Center economist Luis Torres. “Sales fell 9.6 percent for homes priced less than $200,000, the price range that accounted for nearly 60 percent of the total sales decline.”
Realtors and analysts say the Fort Worth area benefits from being more affordable than the Dallas and Collin County areas, though finding a home priced at or $200,000 remains a challenge in solidly middle-class neighborhoods.
“In Wedgwood, you would be lucky to find something in the $200s, and that would be two-bedroom, two-bath and 1,500 square feet,” said Laura Ladner of Burt Ladner Real Estate.
Shipp of Metrostudy said in 2006, about 65 percent of homes sold in the D-FW area were below $200,000.
“Now it’s about 6 percent,” Shipp said. “That’s a price-point that’s almost impossible to find.”
In Tarrant County, median home prices rose 10.8 percent from $203,000 in June 2016 to $225,000 in June this year, according to the Texas A&M Center.
Builders are on track to start about 32,000 new homes in the D-FW area, about the same number as last year, but still well below the 52,000 starts of 2006 during the peak of the housing bubble, Shipp said.
Nationally, homebuilders ramped up construction by 8.3 percent during June, particularly in the Northeast and Midwest, to meeting increasing demand.
New home starts will help increase supply but won’t do much to help the affordability problem in the D-FW area, Shipp said. The median price of a new home in the area has risen to $315,000, according to Metrostudy.
With D-FW median resale prices hovering around $245,000 – and about $20,000 lower in Tarrant County in June – the more affordable resale homes are in higher demand, Shipp said.
“The resale market is very, very tight,” Shipp said. “Because there is such a shortage of affordably priced homes, we’re likely to continue to see price appreciation.”
Local home builders are working feverishly to build affordable homes but a shortage of skilled laborers, rising costs of building materials, higher development fees and more scrutiny by cities to produce high-quality developments has made it difficult to produce homes under $300,000.
Ladner said prospective homebuyers need to look further out in Johnson or Parker counties to find more affordably-priced homes, particularly new homes.
“That was one of the reasons Aledo grew so fast,” Ladner said. “You could get more home and more property for the money, as well as good schools.
Yet, homes in Tarrant County continue to sell briskly with 2,908 homes sold in June compared to 2,788 in June 2016, an increase of 4.3 percent.
“We’re seeing sales at all price points,” Ladner said. “There are just so many more people moving into the area from out-of-state, and they need homes.”
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