The January 2021 DFW area real estate statistics are in and we’ve got the numbers! Our stats infographics include a year over year comparison and area highlights for single family homes and condos broken down by MLS area. We encourage you to share these infographics and video with your sphere.
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
The December 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
Total Texas housing sales stabilized in November following record-setting levels the previous month. Building permits and housing starts normalized after months of strong activity. On the other hand, average days on market fell to just 44 days, indicating steady demand as mortgage interest rates reached all-time lows. Depleted inventory contributed to double-digit annual growth in the median home sales price as an extreme shortage of homes priced less than $300,000 pushed buyers toward higher-priced homes. The Texas Real Estate Research Center’s Repeat Sales Home Price Index also accelerated, revealing threats to recent improvements in affordability.
Nevertheless, Texas single-family sales are expected to maintain a rapid clip in 2021 with an 8.4 percent projected increase, assuming mortgage rates remain relatively low, and the economic reopening continues as vaccines are widely distributed (Table 1). Home sales would be even stronger if not for persistently low inventories. Robust construction activity should provide much-needed injections into the supply of active listings, but home-price growth should still be positive due to solid demand and limited inventory. The pandemic and the associated economic uncertainty remain the greatest headwinds to the Texas housing market in the new year. (For additional commentary, see the 2021 Texas Housing & Economic Outlook.)
Supply1
The Texas Residential Construction Cycle (Coincident) Index, which measures current construction levels, ticked down as real wages and industry employment slowed. Hiring in residential construction, however, has generally been positive since the initial decline in March and April. The Residential Construction Leading Index decreased due to a fall in building permits and housing starts, normalizing after strong growth in the months when the economy first reopened. The real interest rate for the ten-year Treasury bill increased, which also weighed on future improvements. On the other hand, the metropolitan leading indexes trended upward in all but North Texas, where the same statewide factors contributed to a downward adjustment in the metric.
Single-family construction permits flattened around a record-high in November after six straight monthly increases. Nevertheless, the state exceeded its 2007 average in per capita terms. Dallas-Fort Worth topped the national list, issuing 3,641 nonseasonally adjusted permits. Houston followed with 3,630 permits but posted a third consecutive seasonally adjusted decline. Nonetheless, the trend remained on a strong upward trajectory. In Central Texas, 1,974 and 870 permits were issued in Austin and San Antonio, respectively. Texas’ multifamily permits improved on a monthly basis; the year-to-date (YTD) sum, however, fell 8.3 percent compared with the same period last year as demand for single-family homes during the pandemic shifted focus away from the apartment sector.
Although total Texas housing starts decreased 9.5 percent, activity was still on pace to surpass last year’s groundbreakings by about 10 percent. Moreover, the Department of Commerce lowered lumber tariffs from 20 to 9 percent in December, which should help reduce homebuilder costs moving forward. Single-family private construction values mirrored starts as the metric declined 12.8 percent but continued to trend upward. Reduced values in North Texas and Houston accounted for half of the overall drop while Austin and San Antonio recorded more modest contractions.
Although sales activity decelerated, the number of new homes hitting the market flattened for the second straight month after a five-month recovery from pandemic-related declines in March and April. Texas’ months of inventory (MOI) fell to an all-time low of two months. A total MOI of around six months is considered a balanced housing market. Inventory for homes priced less than $300,000 was even more constrained, sliding to just 1.5 months. Even the MOI for luxury homes (homes priced more than $500,000) fell below 4.8 months compared with 7.6 months a year ago.
In Central Texas, listings continued to fly off the market at a rapid pace, chipping away at inventory. The MOI sank to 0.9 months in Austin and matched the statewide average in San Antonio. Dallas’ and Fort Worth’s metrics fell to 1.5 and 1.4 months, respectively. The Houston MOI decreased at a slower rate, hovering at 2.4 months as the metro’s supply of active listings expanded for the second straight month due to new listings in the $300,000-$400,000 and luxury home price ranges.
Demand
Total housing sales were flat in November, ticking down 0.7 percent after reaching record levels the previous month. The modest decline was concentrated in activity for homes priced less than $300,000 as severely limited inventory weighed on sales. Nevertheless, the overall trend remained on a steep upward trajectory with cumulative sales this year exceeding last year’s 11-month sum by 9.0 percent compared with 6.4 percent nationwide. The current rate of growth, however, is likely unsustainable despite stable demand given the state’s depleted inventory.
North Texas and Houston accounted for most of the state’s monthly downtick. Sales declined 2.9 percent in Dallas and 2.3 and 1.2 percent in Fort Worth and Houston, respectively, as decreased transactions at the lower end of the price spectrum offset increases for higher-priced homes. On the other hand, San Antonio posted a record-breaking 3,888 sales after 2.2 percent monthly growth. Austin sales also reached an all-time high, exceeding 4,000 transactions. A list-to-sale-price ratio greater than 1.0 corroborated strong activity in the metro.
Record low mortgage interest rates and shifting homebuyer preferences toward additional living space in residences contributed to robust demand. Texas’ average days on market (DOM) dropped to an all-time low of 44 days, shedding more than two weeks off its year-ago reading. Homes flew off the shelves even faster in the major metros, remaining on the market for only 32 days in Austin and 33 days in Fort Worth. Dallas averaged a DOM of 35 days, while Houston’s metric slid to 43 days. San Antonio’s DOM ticked down to 49 days but persisted above the state average.
Expansionary monetary measures by the Federal Reserve and positive news regarding the coronavirus vaccines lessened investors’ urges to buy safe haven assets. The ten-year U.S. Treasury bond yield inched up for the fourth straight month to 0.9 percent2. Still, a resurgence in COVID-19 cases and persistent uncertainty surrounding the pandemic kept interest rates hovering at historically low levels. The Federal Home Loan Mortgage Corporation’s 30-year fixed-rate fell to an unprecedented reading below 2.8 percent (series starting in 1971). Mortgage rates hovered around decades-low levels within Texas during October, sinking to 2.89 percent for non-GSE loans, while the median interest rate for GSE loans was 2.95 percent. Although home-purchase applications stabilized in November, the steady drop in rates pushed activity up 16.7 percent YTD. Refinance applications nearly doubled since year-end after tripling in 2019, but the pace is expected to decelerate as the lenders add more requisites and the pool of households able to refinance shrinks. (For more information, see Finding a Representative Interest Rate for the Typical Texas Mortgagee.)
In October, the median loan-to-value ratio (LTV) and debt-to-income ratio (DTI) constituting the “typical” Texas conventional-loan mortgage decreased from 87.5 to 84.2 and 37.3 to 35.3, respectively. The median credit score increased from 739 to 752, exceeding levels during the initial rise in average consumer credit scores, which rose due to early relief actions taken by the federal government and lenders that helped some households pay off debt and save money. The median LTV of the typical Texas borrower who obtained a loan from a GSE ticked up slightly from 85.0 to 85.3 but continued to trend downward, while the median DTI slipped from 35.6 to 35.2. The overall trend of improved credit profiles may reflect tightening lending standards as economic uncertainty prevails.
Prices
The Texas median home price accelerated 12.7 percent year over year (YOY) in November to a record-high $274,800. A shift in the composition of sales toward higher-priced homes due to constrained inventories at the lower end of the price spectrum contributed to the increase in prices. Double-digit annual price growth in the state’s metropolitan areas pushed median home prices to all-time highs as well. Austin’s metric skyrocketed 19.7 percent YOY to $370,800, while the median price jumped 13.2 percent in San Antonio to exceed $260,200. Houston median price ($273,200) hovered near the state average after climbing 11.5 percent. In North Texas, 11.9 percent home-price appreciation pulled the metric up to $328,200 and $278,600 in Dallas and Fort Worth, respectively.
The Texas Repeat Sales Home Price Index accounts for compositional price effects and provides a better measure of changes in single-family home values. The index corroborated increased home-price appreciation amid robust housing activity, rising 7.8 percent annually, but the rate of growth was still less than the surge in the median home price suggested. The pace of San Antonio’s index moderated to 6.8 percent YOY growth, contrary to the acceleration in the metro’s median home price. The metrics in Houston and North Texas picked up speed but still registered below the state average, climbing 6.1 percent in Houston and 7.3 and 7.2 percent in Dallas and Fort Worth, respectively. On the other hand, Austin’s index soared 13.9 percent YOY. Home-price appreciation unmatched by income growth chips away at housing affordability, even as mortgage rates reach new lows.
Household Pulse Survey
According to the U.S. Census Bureau’s Household Pulse Survey, 10 percent of Texas homeowners were behind on their mortgage payments during November, greater than the national share of 8 percent (Table 2). Both geographies registered an increase in the proportion of households delinquent on their mortgage payments from the previous month; this was also true of the Houston metropolitan area, where 15 percent of households were not caught up on their mortgages. In contrast, the metric fell from 12 to 8 percent in DFW. Twenty-six percent of the respondents in Texas who were not current expected foreclosure to be either very likely or somewhat likely in the next two months compared with just 19 percent nationwide (Table 3). Moreover, the percentage of Texas households who reported foreclosure to be very likely in the next two months shot up from 1 to 12 percent in November. Those delinquent in Dallas and Houston were overall less at risk of foreclosure than the state average. Just before the survey was taken, the Federal Housing Finance Agency extended the foreclosure and REO eviction moratoriums for properties owned by Fannie Mae and Freddie Mac (the Enterprises) until Jan. 31, 2021. Since the conclusion of the survey period, the Center for Disease Control and Prevention’s federal eviction moratorium has also been renewed through Jan. 31, 2021. Continued stability in the housing market is essential to Texas’ economic recovery.
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1 All measurements are calculated using seasonally adjusted data, and percentage changes are calculated month over month, unless stated otherwise.
2 Bond and mortgage interest rates are nonseasonally adjusted. Loan-to-value ratios, debt-to-income ratios, and the credit score component are also nonseasonally adjusted. Texas data typically lags the Texas Housing Insight by one month.
Source – James P. Gaines, Luis B. Torres, Wesley Miller, Paige Silva, and Griffin Carter (January 13, 2021)
https://www.recenter.tamu.edu/articles/technical-report/Texas-Housing-Insight
The November 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
The October 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
Total Texas housing sales rebounded 6.3 percent in September, pushing third-quarter activity up more than one-third above depressed 2Q2020 levels. Historically low mortgage interest rates helped elevate sales, with new-home transactions increasing more than 8 percent. The Lone Star State’s homeownership rate rose to an all-time high of 70 percent, exceeding the national metric for the first time since 2012. Survey data, however, indicated Texas mortgagees may be more at risk of foreclosure in the coming months than the average U.S. household due to a higher proportion of FHA and VA loans in the state.
On the supply side, lot development slowed in 3Q2020, but single-family building permits and construction values trended upward. Additional housing is greatly needed as months inventory slid to record lows, especially for homes priced less than $300,000. Constrained inventory contributed to the near-double-digit growth in the median home price as the composition of sales shifted toward higher-priced houses. The Real Estate Center’s Repeat Sales Home Price Index also accelerated, albeit at a more moderate pace, threatening recent improvements in affordability. The pandemic remains the greatest headwind to the Texas housing market as the Center projected a slowdown in single-family sales during October amid a resurgence in COVID-19 cases.
Supply1
The Texas Residential Construction Cycle (Coincident) Index, which measures current construction levels, ticked up modestly due to improvements in industry wages, employment, and construction values. The Residential Construction Leading Index rose for the fifth straight month amid increased building permits and housing starts and a decrease in the real ten-year Treasury bill. The major metros also registered growth in their leading indexes except for San Antonio, where permits and starts fell, pulling the metric down.
According to Zonda (formerly Metrostudy), activity at the earliest stage of the construction cycle was sluggish during the third quarter as the number of new vacant developed lots (VDLs) in the Texas Urban Triangle flattened. Only VDLs in North Texas posted an increase, rising more than 40 percent quarter over quarter (QOQ) due to improvement in the $300,000 and above price range. San Antonio’s metric normalized after doubling the previous quarter but still trended upward. Vacant lot development in Austin, however, registered a one-fifth drop below 4Q2019 levels, while Houston posted its second straight quarterly decline following a yearlong climb.
Single-family construction permits backtracked 1 percent in September but remained on a strong upward trajectory after reaching an all-time high the prior month. The decrease was largely concentrated in Houston, where nonseasonally adjusted permits fell to 4,570. Nevertheless, the metro topped the national list, followed by Dallas-Fort Worth (DFW) with 4,193 permits. Issuance in Central Texas flattened at 1,843 and 905 permits in Austin and San Antonio, respectively. On the other hand, Texas’ multifamily permits almost doubled in September, rising to a year-to-date (YTD) high due to renewed strength in the apartment sector. Still, multifamily permits sank 2.2 percent QOQ.
Total Texas housing starts rebounded 20.6 percent on a monthly basis despite record-breaking lumber prices. Zonda data revealed more than 27,100 single-family homes broke ground in the Texas Urban Triangle in 3Q2020, surging 6.1 percent. Activity for homes priced less than $500,000 increased statewide and in Houston, where starts rose 24.6 percent QOQ. San Antonio registered upticks across the price spectrum, climbing 28 percent overall. Starts in Austin and Dallas, however, declined 9.2 and 7.0 percent, respectively, after just modest improvement the previous quarter.
Although single-family private construction values backtracked on a monthly basis in September, third-quarter values rebounded 32.8 percent following a decline during the second quarter. Central Texas posted the largest monthly decreases but increased 28.5 percent QOQ in Austin and 17.5 percent in San Antonio. The metric also maintained a strong upward trend in Dallas and Houston, rising 21.1 and 48.7 percent QOQ, respectively.
Record sales and a dwindling supply of active listings pulled Texas’ months of inventory (MOI) down to an all-time low of 2.2 months. A total MOI of around six months is considered a balanced housing market. Inventory for homes priced less than $300,000 was even more constrained, sliding below 1.6 months. The MOI for luxury homes (homes priced more than $500,000), although elevated at 5.7 months, decreased for the fourth straight month.
Inventory fell to unprecedented levels in the major metros as well, plummeting to one month in Austin. The metro’s MOI for homes priced less than $300,000 was just half a month. In North Texas, inventory dropped to 1.8 and 1.6 months in Dallas and Fort Worth, respectively. San Antonio’s metric matched the state average, while Houston’s MOI sank for the sixth consecutive month to 2.5 months.
Demand
Total housing sales accelerated 6.3 percent in September to an unprecedented high, boosted by historically low mortgage rates. Every price cohort registered increased activity, boosting YTD sales up more than 5 percent above transactions during the same period last year. The Lone Star State continued to outpace the national metric, which surpassed last year’s nine-month sum by 2.1 percent. The current rate of sales, however, is unsustainable given Texas’ depleted inventory.
A shift in preferences from inner-city apartments to homes outside the city center with more space supported new-home sales as well. Per Zonda, Austin new-home sales accelerated 13.1 percent QOQ to an all-time high of 5,389. Increased activity in DFW and San Antonio resulted in 10,782 and 4,150 sales, respectively. Houston sold 8,276 new homes, less than the prior quarter, but posted its tenth straight year-over-year (YOY) improvement.
Strong sales activity during 3Q2020 pushed Texas’ homeownership rate up well above the national rate of 67.4 percent to an unprecedented 70 percent (with the U.S. Census’ Current Population Survey/Housing Vacancy Survey series beginning 1996). Nationally, homeownership fell across all races and every age group, except for 65 years and older. At the metropolitan level, Austin registered the greatest homeownership rate of out Texas’ Urban Triangle for the first time in 12 years, rising almost 9 percentage points to 74.7 percent. DFW’s metric climbed to 69 percent, while San Antonio homeownership stabilized at 66.3 percent. Houston was the exception, with the proportion of owner-occupied units falling from 67.9 to 65.5 percent. Homeownership could suffer in 2021 as COVID-19 foreclosure-protection policies expire.
Texas’ average days on market (DOM) slid to an all-time low of 54 days, corroborating robust demand despite the pandemic. Austin posted the most drastic annual decline, shaving two weeks off its metric to drop to 39 days. The DOM trended downward in North Texas, falling to 42 and 41 days in Dallas and Fort Worth, respectively. Houston’s metric matched the statewide measure, while the average home in San Antonio sold after 58 days.
Low inflation expectations and persistent economic uncertainty surrounding the pandemic, in part due to a dubious timeline for a second round of fiscal stimulus, kept interest rates at historically low levels. The ten-year U.S. Treasury bond yield inched up for the second straight month to 0.7 percent2, but the Federal Home Loan Mortgage Corporation’s 30-year fixed-rate fell to an unprecedented low below 2.9 percent (series starting in 1971). Mortgage rates slid to decades-low levels within Texas during August, sinking to 3.01 and 3.07 percent for non-GSE and GSE loans, respectively. The drop in rates pushed home-purchase applications up 15.5 percent YTD in September. Refinance activity increased for the first time since March, rising more than 50 percent YTD. (For more information, see Finding a Representative Interest Rate for the Typical Texas Mortgagee.)
In August, the median loan-to-value ratio (LTV) and debt-to-income ratio (DTI) constituting the “typical” Texas conventional-loan mortgage decreased from 85.3 to 84.0 and 35.5 to 34.9, respectively, reaching multiyear lows. Meanwhile, the median credit score ticked up from 750 to 753 as average consumer credit scores have been rising during the pandemic due to early relief actions taken by the federal government and lenders that helped some households pay off debt and save money. The median DTI of the typical Texas borrower who obtained a loan from a government-sponsored enterprise (GSE) inched up to 35.6 from 35.5, but the median LTV declined to 85.3 from 85.8. The overall trend of improved credit profiles may reflect tightening lending standards as economic uncertainty prevails.
Prices
The Texas median home price accelerated 9.9 percent YOY in September, reaching a record high $266,500 as the price per square foot for existing homes posted an unprecedented $127. Annual price growth exceeded 11 percent in three of the state’s major regions – Austin ($359,300), Dallas ($326,100), and San Antonio ($261,000). In Fort Worth ($269,900) and Houston ($266,400), the median home price rose 9.0 and 8.5 percent, respectively. The shift in the composition of sales toward higher-priced homes due to constrained inventories at the lower end of the price spectrum contributed to the increase in home prices.
The Texas Repeat Sales Home Price Index accounts for such compositional effects and provides a better measure of changes in single-family home values. The index suggested more moderate home-price appreciation than the change in the median price, but it still accelerated 5 percent annually in 3Q2020. At the metropolitan level, Austin’s metric rose at the fastest pace, skyrocketing 8.4 percent, followed by Fort Worth and San Antonio, where the index jumped 5.1 and 5.0 percent, respectively. The larger metros posted home-price appreciation of more moderate rates, increasing 4.4 percent in Dallas and 3.6 percent in Houston.
Historically low interest rates supported increased housing affordability in Texas’ major metros during the third quarter, but elevated home prices slowed the upward climb established within the past year. Fort Worth and Houston were the most affordable locales with an index of 1.9, indicating that a family earning the median income could afford a home 90 percent more than the median sale price. In both Austin and San Antonio, the metric flattened to 1.7, while Dallas’ index fell slightly below that of the Central Texas reading. Continued improvement is important to Texas’ demographic advantages that have supported the state’s economic prosperity over the past decade.
Single-Family Forecast
The Real Estate Center projected single-family housing sales using monthly pending listings from the preceding period (Table 1). The Center projected only one month in advance due to the uncertainty surrounding the COVID-19 pandemic and the availability of reliable and timely data. Texas sales are expected to increase less than 1 percent in October after climbing by more than a tenth in September. Amid shrinking inventory and an upturn in COVID-19 cases, the rapid pace in Austin and Houston is anticipated to decelerate to 2.1 and 2.4 percent improvement, respectively. Meanwhile, single-family sales are predicted to tick up just 0.9 percent in DFW, and decline 2.2 percent in San Antonio.
Household Pulse Survey
According to the U.S. Census’ Household Pulse Survey, 7 percent of Texas homeowners were behind on their mortgage payments during September, greater than the national rate of 6 percent (Table 2). Although the proportion of homes owned free and clear in DFW and Houston was less than the state average, the percentage of households delinquent hovered around the statewide rate due to a greater ratio of occupants who were current on their mortgage payments. Of the Texas respondents who were not current, more than one-fifth expected foreclosure to be either very likely or somewhat likely in the next two months compared with just 18 percent nationwide (Table 3). That same metric, however, was lower in the state’s largest metro areas where local foreclosure protections may be in place. Currently, federal foreclosure moratoriums are in place until Dec. 31, 2020. Continued stability in the housing market is essential to Texas’ economic recovery.
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1 All measurements are calculated using seasonally adjusted data, and percentage changes are calculated month over month, unless stated otherwise.
2 Bond and mortgage interest rates are nonseasonally adjusted. Loan-to-value ratios, debt-to-income ratios, and the credit score component are also nonseasonally adjusted. Texas data typically lags the Texas Housing Insight by one month.
Source – James P. Gaines, Luis B. Torres, Wesley Miller, Paige Silva, and Griffin Carter (November 17, 2020)
https://www.recenter.tamu.edu/articles/technical-report/Texas-Housing-Insight
The September 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
Here is the August 2020 Summary from Texas A&M Real Estate Center.
The August 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
Here is the July 2020 Summary from Texas A&M Real Estate Center.