‘Rolling Boom’ Into Texas Real Estate A ‘Huge Secret’
A Dallas-Ft. Worth television station has this on the spreading housing bubble. “When homes get a little too pricey, homebuyers start looking elsewhere. At least that’s the theory behind a new housing trend called the ‘rolling boom.’ It’s a trend that’s good news for Texas—and particularly for North Texas.”
“‘This is a house in North Dallas: 5,668 square feet; 6 bedrooms, 6 baths; junior Olympic sized pool; outstanding.’ That’s how Realtor Steven Shipler described a dream house he sold in less than 30 days to a California couple. Shipler said the couple had sold their property in California and had enough equity to literally pay cash for a million dollar house.”
“California, on average, loses about 100,000 residents a year to states like Texas. The effect is what some experts call a ‘rolling boom.’”
“In fact, a thousand new people move to the Lone Star State every day. ‘The Texas market is somewhat of a secret still,’ Shipler said. ‘We’ve just tracked the trend and that trend has gone from California—the L.A. area—through Phoenix, through that market, on over to the Dallas area, and it’s a huge secret.’”
The Star Telegram reports there is no shortage to choose from. “The record pace of home construction in the Dallas-Fort Worth area has hit another milestone: more than 50,000 home starts in 12 months. But the inventory of new houses is climbing. They closed on 45,996 homes in the same period, also a record high.”
“David Brown, director of Metrostudy’s Dallas-Fort Worth region, said that many transfers are selling homes in fast-appreciating areas of the country, enabling them to buy bigger houses for relatively less money in North Texas.”
“In the short term, the inventory of finished but unsold homes is up from a year ago, to a 7.3-month supply from 6.7 months a year ago. ‘We are seeing an increase in the speculative construction,’ Brown said. ‘It’s not a major problem, but it is certainly something we are watching.’”
“Ted Wilson said the new demand hasn’t helped builders much because the builders are still being squeezed by high costs and competition. The competitive pressures to keep the prices down and the upward pressure on the cost of doing business is making the market ‘a pressure cooker,’ Wilson said, and some subcontractors have gone out of business. ‘Their margins are razor thin,’ he said. ‘It’s difficult to compete when you have 15 builders in a five-builder submarket,’ Wilson said.”
‘the inventory of finished but unsold homes is up from a year ago, to a 7.3-month supply from 6.7 months a year ago. ‘We are seeing an increase in the speculative construction,’ Brown said’
The Dallas press used to report straight numbers. A year ago new home inventory was between 9 and 10 thousand. If they are building 5,000 more homes than they are selling at the peak of this ‘boom’, you can bet the builders will overdo it. Notice the ‘razor-thin’ margins; a sign of the excess capacity in north Texas.
Wait until Danielle gets ahold of this one.
Here’s hoping that the California money runs out of steam before it levels Texas like it did Phoenix and Las Vegas. How many more major markets need to be nuked by the Californians before enough is enough?
California will long run out of steam before Texas is over built. There is almost no limit to the land available for new houses. Even within the city limits of Dallas & Fort Worth there are acres and acres of empty land.
and still $2000/acre, same as 1980.
It didn’t level them before, why would it do it this time. Texas useing California mone yto build it next round of affordable housing. It works out well for them. It works like this during boom times in California start a massive homebuilding effort. Advertise to Californians, they in turn drop massive amounts of money buying these properties then realize they can’t get squat in rent. Return keys to bank, locals buy from bank at 25 cents on the dollar and turns it into section 8 housing or boarder houses for illegal aliens. It’s the perfect pyramid scheme
Clearly, you’ve never heard of Phoenix and Las Vegas.
Ben- your blog is addicting. Thanks for your hard work.
Doesn’t anyone buying into a new area, or out of state, do a historical price analysis, a jobs market analysis, look at the big picture,etc…, They just blop their $ down? We’re evaluating states to move to, and we’ve been doing our homework on the bubble effect of the micro markets, the economic base, etc…. People are truly SOS = Stuck On Stupid.
Analysis??? Texas is just one big K-mart Blue Light Special.
Snobby much?
You need to hit the SDCIA board to sell your junky houses. They’re wide open to new “opportunities.” LOL
What’s “SDCIA” and what does it have to do with comparing Texas to K-Mart?
Hey, you live in Texas, right? Do you live in a K-Mart Blue Light special as “mad_tiger” suggests?
“Blue Light Special” as in low real estate prices. California “investors” see a Texas house for $100k and think it must be a bargain. So they just buy it without bothering to do their homework.
Mad_tiger, my apologies for misinterpreting your post.
I just notice many make disparaging remarks about the South and Texas, and think such talk is snobbery, and mistook your comments as such.
LOL. I doubt very many people looked at long term charts of Nasdaq before they plunked their money in at Nasdaq 5000 either. It’s always “it’s different this time”, “it won’t happen to me”.
I used to think how people carefully invested their money was a function of how hard it was to earn the money, but I’m not so sure. I guess it is easier to be freer with the $$$ when you earned it easily by bubble equity and just monetized it. On the other hand when you have to work and save every nickel for a down payment I would hope you’d think hard about where to invest the money. But I don’t think my theory is 100% true - people have lost hard-earned savings as well as easy credit at market tops.
Our country’s primary form of financial education is the black box that contains our favorite TV shows and a whole hell of a lot of commercials. We are trained to buy, buy, buy from the time we are in diapers. Buy now and pay a lot more later. Your level of education doesn’t matter either. It seems as though the more educated you are the worse your financial situation. I think that is because people come out of college feeling they deserve all this stuff and at some point their college education will pay for it later on. I was that person years ago and then I realized that I don’t deserve a lot of nice things until I have the money to buy them. And my degree is not a guarentee of that money.
It’s real hard to cash out of Kalifornia and not want to reward yourself for being so smart and all. You got a cool mil so you buy a nice $800k manse almost anywhere and the interest from the rest pays all the expenses. Live for free in luxury for the rest of your life? Who cares what it cost last time or next time? Fact is you still aren’t living in Kalifornia and no matter what you hear that’s a step down nearly all the time from the best places in the State. The people who move are leaving congestion choked megaopolisis’ where just about anyplace else is better.
Hey, wait a minute. I cashed out in Oct ‘05 and now I am renting a 2 bd 2 bath half of a duplex in the Ozarks for $550/mo.
IMO almost anywhere out of CA is a step up.
Leave the SKY-HIGH taxes, crime, crappy expensive housing, congestion, smog, intrusive gov’t, gold-digging attitudes… behind and thank yourself.
Don’t forget landslides, high car registration expenses, and virtually everyone walks around with blinders on. Just go to any strip mall parking lot in Cali and you’ll see what I mean. Nobody looks around when they walk through parking lots, they can only see what’s straight ahead. Clueless that something might be coming up behind them or from a side.
It’s really quite a simple calculation. I call it the quality-of-life tally. CA & NYC place at the very bottom of the list.
Schools are another measure where CA flat-out fails - miserably, at least in the LA area. All that tax $$$ and schools are a total catastrophe. It’s unsafe to send a kid to public school, let alone expect them to learn anything. Teachers are not paid enough to eat let alone live in suitable shelter. I see a 70% decline in RE in CA to get the area reset to what RE is truly worth.
It’s truly remarkable there. Go into the supermarkets and watch in amazement as the shoppers scan the landscape to save 4 cents on an item yet they jump into a $60K Lexus to drive 1/2 a block to some 1400sqft dump they paid $1M+ for.
Pathetic.
Car registration is a lot better but all the other complaints hold. 9.3% income taxes, 8.25% sales taxes on everything and decline QoL. The only “but” is that this is for the 3/4ths that live in the big urban areas or away from the coast.
Everyone predicts a massive decline for California always have always will, but its always stayed expensive and whatever decline is to come it with only decline to expensive again.
Now Robert, do you think that perhaps it COULD be different this time. What we’ve been witnessing is a LOT OF $$$$$$$$ leaving the state along with some of its most productive contributing members of society. What’s left behind are all the gang bangers, parolees and marginal members… social workers etc etc… Then there’s all that state debt to fund… somehow?
There’s a major house of card set up in CA and it’s getting very very windy…
There’s always a chance of it being different this time. In fact there’s always a little different everytime. Last time we saw aerospace leave, this time biotech will leave and the real estate industry will just disappear.
A -lot- of money is leaving. In ways you don’t even imagine. My proceeds from the rental sales are not here that’s fer sure. Bloodsucking state parasites tax capital gains as regular income. Never make that choice again. So, not only are the people we most need to stay leaving the capital base is leaving as well. It’s only going to get worse with the amnesty costs and state bankruptcy. Oh, California may not declare actual bankruptcy but its operations will have to adopt bankruptcy practices.
The thing to remember however is that California is not LA & SF with their suburbs. It’s a biiig State with lots of natural advantages that even decades of single party politics could completely destroy.
I have to agree to a certain extent with Robert. California is certainly a beautiful state in terms of naturaly surroundings, one cannot deny that. However, there are other states that are just as lovely: Colorado, Montana, etc. Unfortunately, California has created a certain ugliness about it. The wastefullness, arrogance, flippance about money and general feeling of superiority has made it a very unfriendly, hipocritic state. On the one hand they preach recycling and antipollution and yet I have never seen more hummers, sports cars and other gas guzzlers in any other part of the country than in California. The wealthy, which this state has a lot of, seem to think that concern over the environment is a poor mans issue. I live in S. Florida and I find that both LA and Miami are very similiar in their decadence and poverty. So please, don’t place California on some pedistal because the positives do not outweigh the negatives.
I do have to add. If I did have to leave California, I would not pick Dallas or Houston, Austin yes. Dallas and Houston are flat, unremarkable cities and for a Californian that would be a difficult adjustment. But ladies, the Texas born men will always hold a door for you and are quite respectful, generally. That did impress me. Go to Miami and you’ll be lucky if they look at you as they slam the door in your face. S. Florida has some the rudest people I know. That may be because most people here are from New York. I can’t wait to move.
Get rid of the illegals. No amnesty. And, there will be plenty of affordable housing, prices will drop, the State budget, hospitals ,and schools will be 15 billion better off.
“Fact is you still aren’t living in Kalifornia and no matter what you hear that’s a step down nearly all the time from the best places in the State. The people who move are leaving congestion choked megaopolisis’ where just about anyplace else is better.”
So true! I tire of California bashing, as I live in a neighborhood with almost no crime, surf several times a week, know all my neighbors, have clean air, have non-freeway drives of 15-20 minutes to every possible service and entertainment, and have plenty of private schools to supplement the top-scoring public schools nearby. I bought my home six years ago for under 500k, and would never consider moving out of state: the lifestyle just can’t be beat.
“have clean air, have non-freeway drives of 15-20 minutes to every possible service and entertainment, and have plenty of private schools to supplement the top-scoring public schools nearby”
Hmmm, that seems to be a little difficult to reconcile, if you happen to be a typical Califonian, given the continual gridlock on the roadways and abysmal air quality. The schools always rank among the nation’s absolute worst. Where in CA do you live that you can be so insulated from all of the normally honestly accepted critcisms?
Consider yourself an oddity and pity the rest of your overtaxed neighbors across the state.
I have exactly the same experience as LA_Landlord. My two biggest complaints are the 1.2hrs it takes to drive and shuttle to my season seats at the Hollywood Bowl and the Friday congestion if I leave late for the mountain cabin for skiing. In both cases it involves Los Angeles. Thing is most people have this notion that SoCal -is- Los Angeles. Nope. In fact I love to confuse people by telling them that the biggest industry in my County is Agriculture and my kids are in 4H. It just doesn’t square with most peoples’ idea of SoCal. It takes a bit of explaining but trust me, the common perception is the wrong perception.
Robert, there are 20M+ people in So CA and almost all of them are on the freeways at the very same time. Almost none of them are involved in agriculture except to eat it occasionally, when they have time.
I fly over So CA every week and the only thing I can tell you for certain every single weekday is there isn’t enough room on any of the roadways to stuff an automobile in sideways. You may qualify as one of the exceptions — Most certainly not the rule.
Your experience with taxes is horrifying. The marginal people making barely enough to exist don’t pay taxes. There are a lot of them. Take a drive from the beach all the way through Riverside. You will discover that most of the inhabitants live in absolute crime infested squalor. You are paying the taxes that those people don’t.
You need to travel out of CA to see how the more relaxed and happy people live…
You may qualify as one of the exceptions — Most certainly not the rule. Yeah but there are millions of exceptions.
Your experience with taxes is horrifying. Again, I’m an exception. My property taxes as calculated in normal states is about $2 per thousand.
I travel a lot. When I dropped off my thesis in Boston I rode my motorcycle first to Florida and then California. I know there are many millions of teeming scrabbling Californians. What you don’t know is that there is an entirely different Califorina that doesn’t show up on radar and we prefer it that way. My backyard:
http://users.adelphia.net/~techscan/Backyard2.jpg
50 miles west of Downtown Los Angeles no less.
I would have expected it to be a bit more watery 50 miles west of downtown LA.
If you look at the geography of the area, there’s around 60mi or so of south facing beaches west of LA. He probably lives around Thousand Oaks or Camarillo in Ventura County…
Yes, taxes are high, but so are salaries. Most people I know with jobs around here have plenty of disposable income. Once you buy a home, you are locked in with Prop 13, restricing tax increases.
I’m in Northern California on the Peninsula–I’m renting, but lifestyle is great. 45 minutes to the beach, 4 hours to the snow, I have a 3 minute commute to work (or 10 minute walk when this god-awful rain lets up), a 10 minute walk to a “main street” style downtown with restaurants and shops (with folks at the local hangouts that know you). A great mall a walk away, major University with all major sports and world class hospital. My wife has a 10-15 minute non-freeway commute. No problem with air quality. Good schools nearby (public and private).
My wife and I count ourselves among the fortunate in CA–we live in fantasy land.
He probably lives around Thousand Oaks or Camarillo in Ventura County…
AZ_BubblePopper, Camarillo it is. You get an A+ in geography. It’s always fun to mention this little quirk of nature.
I bash Texas nonstop but can’t think of a single thing I didn’t like about San Diego except the high cost of housing. Loved it there.
I agree with you. I’ve travelled extensively and have lived in all four corners of the U.S. (currently South Florida/Miami - Yuch!). Though there are many beautiful places to see and visit, when you add it all up, I truly think Southern Cal if the best place to live. It’s far from perfect, and needs to get the illegal immigration in check. But all in all, I like it better than anywhere else. Only problem is that if you don’t have the bucks to support a good lifestyle, then there are lots of reasons to leave. That’s why I’m out…solely because my money will go farther else where. However, I’m keeping my eye on the market back “home”. If prices drop by 20%, it might be attractive to come back (Carlsbad/San Diego). Also, areas I didn’t consider before, like Temecula are looking better. Golf, good weather, pretty scenery, and only about an hour from the beach or 2 hours to the mountains. That might be an option if prices come down.
No because if they did particularly in the Dallas area they would know that as far as Texas is concerned it is the biggest no no of all times as far as real estate investing if your not local. I remember during the last downturn there was lot of California money down there and blood was running down the street. It seems history is repeating itself. How anyone could possibly be thinking about buying a new home down there with bank inventory that has been growing steadily for at least a year and a half on the R.E.O. lists that I happen to track of various lenders is beyond me. These folks are doing absolutely no research. Amazing
As my uncle in Texas says… these people are shining their butts… and it looks like they are doing a fine job of it. Texas loves nothing more than giving California a good swift kick in the butt too… so they will be glad to kick the heads out of the butts down there. Let it happen. These people should have spent more time doing a little research.
Foreclosures at multi year highs. This stuff just gives me a headache.
That’s correct. And D Magazine, at the behest of local realtors and developers, recently put out a “Steal This House” cover story for them to send to the Stuck on Stupid in other states.
I’m not going to repeat what everyone has heard from me ad nauseam for months. Suffice it to say, out of state money will die here. The DFW locals will shear these sheep and the local bankruptcy lawyers will take what’s left down the line.
You can shear a sheep forever, you can skin him only once.
Clearly the current crop does no analysis, witness the areas in which they “invest.” It’s quite amusing, really.
Yea, Like just where exactly is Little Elm, Texas and why is it being marketed as the next boom party. Had someone email they were trying to get $1,650 a month for a 4+3 1600 or 2400 sqft don’t remember now cause it doesn’t really matter I get a lot of stupidity in my email these days.
OMG. Stop it before I embarrass myself in front of others here. LOL
Little Elm is up there in Denton County. You would be driving a minimum of 90 minutes to work each way every day in the worst traffic imaginable.
The houses are junk. There is land to build more as far as the eye can see.
Obviously the guy who emailed you typoed. You’d be lucky to get $650 in Little Elm.
No typo, I saw the craiglist ad paid mid to high 200’s for it from what I could glean from public records. It’s a new development plenty of Cali owner addresses. And from the pictures it could best be desrcribed as one step up from public housing dead yard and all
bwahahahaha…. and in Denton the nearest thing to a high rise for miles and miles and miles and miles… did I say miles? would be the TWU dormitory!
new development or not… it ain’t happenin’ there!
I agree. I live in Denton County also. Little Elm was written up not too long ago in a local newspaper (rural of course) about how many spec houses were out there. There is no way to get 1,650. It will be run down in a couple of years.
Wow. Can you imagine air conditioning a 5,500 sf monster in Dallas? Really, I shouldn’t say Dallas, because most likely that is going up in some place like Farmer’s Branch or Lewisville. Enjoy that commute too! Beautiful views will include 15 foot tall mesquite and scrub oak. What’s not to like?
I thought about that AC bill too. Surely, these Californians spent a few months there before dropping a million. Wouldn’t the property taxes on a home like that be enormous?
Ben, it’s just too stupid to even discuss.
The property tax bill would probably be around $30k a year, but Texas doesn’t have income tax so if they have high incomes their Texas taxes might only be a little higher then their property and income tax was in California plus they don’t have a mortgage in Texas. Which is good since the AC would probably be what a mortgage payment on a nice house in most parts of the country would run.
If you consider property taxes of $30 to #35k per year, Insurance of say $4K (probably too low), electricity/gas of $10k per year, and maintenance on the cracker box of $6k per year, carrying costs are roughly $50-$55k per year before anything else. I hope they still have a good paying job!
Not to mention the property taxes that almost hit 3%. And unlike California, they can and do go up every year.
ac (and/or heater)
that’s the thing that most who lived in southern california coastline do not consider when they move out of state.
If enough of these SOS people leave California , maybe this market will break down and return to normal. What ever that may be.
‘In fact, a thousand new people move to the Lone Star State every day.’
Is there any place in the US that doesn’t make this claim?
Woody Guthrie weighs in on this:
Do Re Mi
Lots of folks back East, they say, is leavin’ home every day,
Beatin’ the hot old dusty way to the California line.
‘Cross the desert sands they roll, gettin’ out of that old dust bowl,
They think they’re goin’ to a sugar bowl, but here’s what they find
Now, the police at the port of entry say,
“You’re number fourteen thousand for today.”
Oh, if you ain’t got the do re mi, folks, you ain’t got the do re mi,
Why, you better go back to beautiful Texas, Oklahoma, Kansas, Georgia, Tennessee.
California is a garden of Eden, a paradise to live in or see;
But believe it or not, you won’t find it so hot
If you ain’t got the do re mi.
You want to buy you a home or a farm, that can’t deal nobody harm,
Or take your vacation by the mountains or sea.
Don’t swap your old cow for a car, you better stay right where you are,
Better take this little tip from me.
‘Cause I look through the want ads every day
But the headlines on the papers always say:
If you ain’t got the do re mi, boys, you ain’t got the do re mi,
Why, you better go back to beautiful Texas, Oklahoma, Kansas, Georgia, Tennessee.
California is a garden of Eden, a paradise to live in or see;
But believe it or not, you won’t find it so hot
If you ain’t got the do re mi.
Words and Music by Woody Guthrie
http://www.woodyguthrie.org/Lyrics/Do_Re_Mi.htm
too bad there all from jalisco
Tiajuana or Yarezz Meixco?
“High prices force homebuyers to move to the suburbs, smaller towns, or across state lines”.
Osmosis: Diffusion of fluid through a semipermeable membrane from a solution with a low solute concentration to a solution with a higher solute concentration until there is an equal concentration of fluid on both sides of the membrane. http://dictionary.reference.com/search?q=osmosis
Or said another way, after you lay down linoleum and you find a bubble, you flatten it down, but then realize it just moved somewhere else. If you lifted up the linoleum here in Maine, and got out a microscope, you’d find the place crawling with Equity Nomadis organisms.
a million dollar home in texas is going to cost you nearly 35K a year in property taxes which if my math is correct about 3K per month.
ouch !!!
In Texas, you don’t need to spend anywhere near a million dollars to have a lavish home in a good neighborhood.
$350 to $400K will get you a 4,000 square foot house with a 24×18 “game room,” a giant living room, a large den, a “study,” 4-5 bedrooms, a breakfast eating area, a mack-daddy kitchen, a 3 car garage, an elaborate built-in pool with a waterfall, etc, etc.
Taxes will be about $10K.
Look online at what’s out there, it’s insane. Even if the house dosn’t really appreciate much, it doesn’t matter much because it will be the last house you’ll ever need to own.
And of course, you’d love to sell them one, wouldn’t you.
Sorry, I don’t sell anything, but I’d like to buy a house in Texas if the job market wasn’t so mediocre.
“In Texas, you don’t need to spend anywhere near a million dollars to have a lavish home in a good neighborhood.”
But you’ll need a million dollars to buy yourself hallucinogenic drugs to forget that you are in Texas.
You’re one of the few Texans I’ve come acress who constantly puts down where they live. Why do you live somewhere you hate?
1000 a month is a house payment texas sucks
But what about other things. I don’t doubt that 300-400K, but how much are taxes and insurance. In Nevada 300K will get you a modest home, but your taxes and insurance will run about $1000 a year.
Taxes will run about $10K + $3K local municipal fees.
A similar house in the Northeast would cost $2 million, and have taxes of 30K+.
“…it doesn’t matter much because it will be the last house you’ll ever need to own.”
…Until it starts falling apart around you due to the piss-poor building practices, crappy materials and workmanship, or the poorly designed slab foundation cracks due to the heaving soil here. Enjoy your insurance premiums too…TX has the highest in the nation.
TX is a crooked builder’s wet-dream come true. Good luck trying to get your money back because the corporate-owned TX state govt. has taken away most of the home-buyer’s rights to recover damages (tort reform–remember where Bush came from) and forces them thru a state mediation board bought/paid-for/run by the homebuilding industry.
So if any of you from Cali want to pony-up for a house here in TX….come on down! But don’t think you’ll be buying your last house…they are built to be disposable ’round here now.
We have friends that moved to Austin during the hi tech boom, and boy, they got slaughtered in the housing market, as the job market dried up. Personally, I like to diversify my risk. Gold, Energy, Natural Resources, Asia, Aging Demographic related stocks,etc…. I can’t imagine just owning a home, and that’s your asset. Wasn’t the last housing bubble correction a lesson.Very naive.
Had a neighbor here in Arroyo Grande who sold his house last year for $875k. He bought a 3,500 sq’ house w/pool on 2 acres near Dallas for $300k and marveled at the great deal he got. Now he tells me the family can’t use the pool/yard in the summer because of the oppressive heat and humidity. He really misses the central coast of CA. Go ahead and take your bubble bucks to TX, I’m stayng here.
All & All it seems you know, you don’t know what youve got till its gone….
Wait until he encounters the local fleas and roaches. The ones at the mall that is.
Once I was up late studying in Arlington (near Dallas) in the summer. The guy on the radio said it was 95 degrees outside. It was midnight. All that concrete soaks up the sun and radiates it at night.
I actually like the heat. In fact, that’s the only thing I do like about it here. If you want to get in shape (cardio) you can’t beat working out/running what have you at 2-4 p.m. in the middle of the summer. When I was in college and playing tennis for the school, I used to kick butt on the girls from other states who couldn’t play for 3-4 hours in 96 degree heat and 70% humidity.
Isn’t that dangerous?
Oh yeah, I was visiting my daughter in San Antonio (in August) it was over a 100 degrees outside at midnight!
“If I owned Texas and I owned Hell, I would live in Hell and rent out Texas” - General Sheridan, 1865
>He really misses the central coast of CA.
Yup, I can understand that. However, $875k for 2K square foot houses here is just insanity.
Therefore, I rent, spending my time at Pismo and Avila Beach, watching first hand as the housing prices slowly and fitfully get dragged down…
“…spending my time at Pismo and Avila Beach…”
Been there, done that, and miss it every day. Unfortunately, I simply cannot afford to raise my family anywhere close to there with such a disconnect between housing and wages.
‘The local growth comes at a time when the Austin home market is emerging from a slump, experts say. For the past several years, home appreciation levels have hovered in the single digits, sometimes as low as 3 percent. But in just the past three months, homes in some parts of the Austin area have appreciated by as much as 40 percent.’
‘Mark Sprague, a partner in the local office of Residential Strategies Inc., says the upper end of the market, in particular, has seen substantial growth. As homeowners on the East and West coasts sell their properties to take advantage of local housing bubbles, many seek to relocate to Central Texas — and they come with large profits to invest in deluxe homes, Sprague says.’
But they can’t sell them anymore!
If memory serves me well, when my sis lived in Texas (arl’g) they had some pretty bad storms…seems I remember car window smashed and exterior dented from hail. BTW, any tornadoes pass through that area?
There was a little storm named Rita.
Driving across country last month we heard a local dallas radio show.
Seems they were discussing an impending law change that would allow the more speculative loans or marginal buyers thus opening the flood gates there…Not sure on the facts ,just remember the discussion. That being said :great food, nice people ,but if you tell me they aren’t making any more Texas land you’ll get a smack
Texas is a little behind on creative financing. Home equity loans were illegal up until somewhere around 2000.
I think you guys are missing the point. It doesn’t matter how shitty Texas is. It just matters where the bubble rolls next. It’s a ponzi scheme. As long as more investors are coming, there is money to be made…until the investors stop coming.
People understand; however, it’s always hee-larryus fun to poke at the stupidity of buying RE “investments” without researching the area (or, in some cases, even visiting the actual house).
Hyuk, sure I’d like to buy some pets.com stock! I read them thar newsy-papers, and I know that interneck stocks always go up!
Do you folks commenting here have kids or not? When I was single the thought of Texas outside of perhaps Austin would have made my skin crawl. I grew up in Oregon and spent most of my single adult life living and working in Portland, Seattle, and DC. But now that I’m married with 2 kids and a 3rd on the way and my wife’s career brought us here I don’t half mind it.
We live in a suburban area NW of Waco along the Brazos river in what is sort of a mini-hill country. Very pleasant. Kids go to good schools and live in a safe neighborhood where they can run around, explore the woods, and ride bikes to their friends houses. Home Depot and Target are the same distance away as they were in Portland. Except there’s a LOT less traffic.
My wife and I spent part of November interviewing for jobs back in Oregon, mostly in the Portland-Salem corridor where I grew up and I was horrified to see how much it had grown and how little hour housing dollar bought. Not to mention the decline in the public schools due to Oregon’s everlasting anti-tax jihad. We looked at a lot of $400,000 houses that were stacked so close to the neighbors houses that you can practically reach out the bedroom window and touch the house next door. On streets with no sidewalks or nearby amenities. And within central Portland they can’t close schools fast enough as the city is depopulating of families with children.
In the end, we decided to stay put in our relatively modest 2,400 sf 4 br 3 ba house on a 3/4 acre wooded lot that we bought new in 2003 for $180,000. My wife likes her work and we like the local schools. We vacation in south America (my wife’s family is from Chile) so that’s a much easier hop from DFW than from PDX or SEA.
We’re pretty typical of our neighborhood. About half our neighbors are from out of state who moved here for career reasons (Baylor professors and execs a local corporations mostly). No one seems unhappy to be in Texas. Don’t believe all the crap about how unlivable it is here. I find I actually prefer it to the struggle of life in an expensive west coast city.
As for housing bubbles? I do agree that Texas is where real estate investors come to die. I see ticky tack housing going up everywhere around Waco. No way there is that much demand to fill all the new construction. Problem is that it is just to easy to become a developer here in Texas. Outside the city limits there aren’t even building codes unless you live in a gated subdivision with a HOA. Anyone can buy a 50 acre cornfield and toss up 100 new houses overnight using immigrant labor. But it isn’t just the real estate speculators who will lose their shirts. I think a heck of a lot of builders are going to get crushed as well when they can’t sell all the stuff they are building.
But will it affect us (my wife and I) personally? Not really. We can ride it out. Our house is where we live, not an investment. We could walk away from it tomorrow if we needed to by cashing in a bunch of IRAs. I’m an avid investor and I’ll never drop a dime of my own money into Texas real estate except for the home I live in. EVER. I’ll stick with my boring US and international index funds, thank you very much.