The Housing Bubble

A report from the Dallas Morning News in Texas. “The slowdown in Dallas-Fort Worth’s housing market may be worse than at first glance. Sales of preowned single-family homes dropped 1 percent annually in August in all of North Texas, according to the latest numbers from the Real Estate Center at Texas A&M University. Those numbers include data on more than two dozen counties stretching from the Red River to Waco. When you drill down in the numbers to just the immediate D-FW area, August’s dip in home purchase activity was much larger. In the Dallas area, sales of preowned homes by real estate agents fell by about 4 percent in August from a year earlier.”

“But some Dallas-area residential districts saw marked declines in home buying last month. Real estate agents say the overall numbers understate the housing sector cool down. Sales last month were down almost 31 percent in Far North Dallas. They dropped 24 percent from August 2017 totals in Allen, and were off 21 percent in Coppell. Plano had a 16 percent year-over-year sales decline and sales were down more than 11 percent in Richardson and about 9 percent lower in Frisco.”

“So what’s the takeaway from all this? D-FW still has a good home sales market, but not as robust as last year. That’s good news if you are trying to buy a house in the area. But you probably should have sold one last summer if you wanted a line of potential buyers at your front door.”

The Scotsman Guide. “Housing analysts told Scotsman Guide News this week that the U.S. housing market has hit a plateau. The latest tracking data for home-purchase mortgages appears to confirm that. Attom Data’s Daren Blomquist told Scotsman Guide News that the demand for home-purchase loans ‘was trudging along,’ but rising mortgage rates and eroding affordability have taken a toll.”

“‘Especially when you look at some of the local markets, we are starting to see mortgage rates have a chilling effect on some of the purchase originations,’ Blomquist said. He noted that home purchase counts have declined by double-digits in Los Angeles and Dallas, where affordability has become a problem.”

“Blomquist said this flatness in the home-purchase market will likely continue until home prices cool off, or come down. ‘It has been such a strong sellers’ market, but this spring and summer may have been a bit of a wake-up call for sellers that they can’t get whatever they want for homes,’ Blomquist said.”

The Scottsdale Independent in Arizona. “For the city of Scottsdale, the housing market started in a lull, but has since picked up steam, according to Becca Lining, a Realtor with RE-Max Excalibur. The market experienced a small delay at the start of the school year, but has made a quick recovery,” she said pointing out all economic indicators suggest a steady, healthy housing market. ‘There is speculation of a ‘bubble’ from consumers and economists, however, I have seen a strong market with moderate appreciation, which indicates a healthy future.’”

“Thus far in 2018, there have been 5,908 single-family homes sold in Scottsdale, numbers show. In Scottsdale, there are 24.5 percent fewer homes for sale, which experts say is fueling healthy gains in both median sales prices and closed sales. There are 21,717 active single-family home listings in the city of Scottsdale, as of Aug. 31.”

“No market illustrates the idea of affluence better than the Town of Paradise Valley, but just as any marketplace, norms and emerging trends are beginning to shift, experts say. However, as much things change, they stay the same, according to Dub Dellis, who serves as chief operating officer at Walt Danley Realty. The group now has an office in the DC Ranch area — Mr. Dellis says the idea of luxury downsize is becoming a want his group is looking meet.”

“‘The buyers today are more educated than ever before,’ he said, pointing out consumers know what they want. ‘We have shifted from being the provider of the information and our role now is to interpret that information.’”

“‘The reality is, when you look at the pricing — it has been flat for a few years, but there has been an uptick,’ he said. ‘The average price of square foot going up is due to the product that is selling. It all depends on the type of property you have. If you have a newer property, that is what the buyers are looking for, but if you are in an older home that isn’t updated, the prices are going the other way.’”