Texas was one of the last States to enter the recession and is now leading the recovery. In fact, as of December 2012, there were more people employed in Texas than ever before – and there are more people. According to Census Bureau estimates, the population of Texas is growing by 1.5 to 2% per year.
All factors work together, and many economists credit Texas’ pro-business attitude and the lack of a state income tax on individuals for the low unemployment rates and population increases.
The supply of jobs and the increase in population is, of course, good news for the real estate industry, and for Texas home builders. As the supply of existing homes continues to dwindle, new housing starts are on the rise.
Texas has always led the way in housing starts, and the major markets in Texas (Austin, Dallas/Fort Worth, Houston, Rio Grande Valley and San Antonio) accounted for 9.15% of all starts in the U.S. even at the peak of the housing market in 2006.
That share jumped to 11.31% in 2012, and according to the Star-Telegram (http://www.star-telegram.com/2013/04/04/4751379/new-home-starts-on-the-rise-in.html) , starts in the first quarter of 2013 are up 35 percent from the same period of 2012.
Interestingly, within the top housing markets in Texas, there is almost an even split of activity between the publicly traded (54%) and private builders (46%) operating in Texas. DR Horton is the top builder, with 5,796 single-family homes started in 2012. This accounts for 10% of the starts in his favored markets.
A low supply of new and existing homes for sale, as well as a growing job market, is pushing home prices upward. For instance, according to CoreLogic, the price of non-distressed homes in Fort Worth-Arlington is up 8.8% in February 2013 over February 2012. In addition February was up 2.5% from January.
As of the end of March 2013, inventory levels in Dallas-Fort Worth were down more than 50% from levels at the end of 2008.
On a somewhat troubling note for those busy Texas home builders, the inventory of available building lots is also at the lowest level in five years.
What’s the message for would-be Texas homeowners? Be ready to act when you find your home.
• Get pre-approved before you go shopping – in order to give home sellers the assurance that you can back your offer with action.
• Don’t try to low-ball your offer – you’re very likely competing with other home buyers.
• Don’t ask for too many concessions.
• Consider purchasing a home while it is still under construction.
When you’re ready to find your home, give me a call at 800-223-7409. I’ll be happy to get you pre-approved and to find you the best possible rate and terms for your home mortgage.
Texas Mortgage Banker