Dallas Housing – One Hot Market
All in all, Dallas Housing – One Hot Market. The general consensus among housing analyst and economist is the Real Estate Market in Dallas, Texas will change for 2016. Home prices in Dallas, Texas will probably continue to rise through 2016, but gains might not be as steep as what we have seen in 2015.
Since 2013, home prices in Dallas, Texas have returned to pre-housing-crisis levels. In other words, they climbed back to where they were at the height of the bubble. And they have been rising steadily ever since. Last month, a widely cited housing report showed that Dallas home have risen to yet another all-time high. Meaning, house values in Dallas, Texas have not been higher.
Dallas Real Estate Market
The question is, how long can this last? Will we see a double-digit price gain in 2016, as we did in 2015? Not likely, says the economists. Most predictions for the Dallas real estate market in 2016 call for additional, but more price gains. And to be honest, this market could use a little cooling.
As Dallas home prices rose sharply over the last couple of years, so much that some analysts were using the “B” word – bubble. The rate of appreciation seems to be slowing down.
Economist at Zillow say that Dallas home prices will rise by 5.8% in 2016, compared to a whopping 16% in 2015. This mirrors the cooling trend that is happening in other markets across the country.
Like many cities in the U.S., the supply and demand situation in the Dallas housing – one hot market, is starting to normalize. To be clear, there still are not enough homes listed for sale to satisfy demand, especially in popular neighborhoods. But the inventory crunch of the last couple of years seems to be easing. In December, Realtor.com reported a 2.9% increase in the number of Dallas homes for sale, year after year. So there’s a bit more inventory today than the same time last year.
Hot Markets in The U.S.
Speaking of realtor.com, each month they publish a list of the “hottest” housing markets in the U.S. The report is based on various measurements including supply and demand for homes. Houses in these real estate markets tend to sell faster than in other cities.
In November, Dallas housing one hot market, was ranked #5 on the hottest housing markets list. It was outranked by only four other U.S. cities – Denver, and 3 cities in California.
But things might be different in 2016. realtor.com also publishes a list of markets to watch in 2016. And Dallas is not on that list. According to the company, “Many of the markets that have consistently made our “hot list”…didn’t make the cut for 2016. Because they are predicted to see slower price appreciation and some even decline in sales. Notably, they include the greater metro areas of San Francisco, Denver and Dallas.
This is yet another housing forecast for Dallas that calls for smaller price gains in 2016. So when a lot of knowledgeable people are saying the same thing, chances are you should listen as there has to be something to it.
Dallas Housing – One Hot Market
Right now, there is a meeting of the minds among Federal reserve officials. The Federal Open Market Committee (FOMC) is meeting over December 15-16 to discuss the current state of the economy and, more to the pint, whether or not they should raise interest rates or not.
For years, the Fed has kept the short-term federal funds rate near zero to stimulate the economy. But improvements in the job market and other areas have changed their view. There’s a strong chance FOMC members will announce an anticipated rate hike.
So here’s the question. what does this have to do with the Dallas housing – one hot market? If the Fed raises the short term funding rate, we will almost certainly see a corresponding rise in long term mortgage rates. Some economist, including those at Freddie Mac, Have previously predicted that mortgage rates will rise gradually throughout 2016. This will create a stronger sense of urgency among home buyers, which could lead to an upsurge in housing demand in Dallas.
After all, when home prices and mortgage rates are rising, it’s like a double-whammy for homes buyers. It erodes their buying power over time. So Dallas home buyers who put off their purchases until later in 2016 could end up paying more for a house and a mortgage loan. hence, the sense of urgency.