Analysts Credit Home Building Increase To Record Low Interest Rates
PLANO (CBSDFW.COM) – Analysts say record low interest rates are building the housing market in some areas of North Texas back up and out of a severe slump — especially for homebuilders.
Drive around many parts of McKinney, Allen, and Frisco in Collin County and in northern Tarrant County. You’ll find houses going up in different price ranges.
According to the Texas A&M Real Estate Center, current levels of existing Dallas/Fort Worth home listings between Jan. to the end of May show a 4.5 month supply rather than six months, which is considered to be the industry average.
And new home starts climbed 19 percent in the second quarter of 2012 compared to the same period in 2011 –– 3,804 then to 4,538 now.
Brooke Pretzel says she and her husband decided to sell their Frisco house and buy a new home because of these interest rates.
“We’re moving up in our square footage, but we’re going to be paying only a few hundred dollars more month,” Pretzel said.
Ted Wilson’s company, Residential Strategies, tracks construction of single family homes in the Dallas-Fort Worth area.
“North Fort Worth to McKinney and those are the markets that seem to be doing very well. The construction of homes is way up in those markets,” Wilson said.
It’s not just new construction on the rebound, but the existing home sales too — in those same areas along with parts of Dallas, and the Park Cities.
“There’s price increases going on. We’re seeing more competition on the better properties,” Wilson said. “I would say in those cases, we’re seeing a seller’s market.”
When Brooke Pretzel and her husband put their house on the market, they expected it to take a month or two to sell. It went much faster than that.
“Once we were on the market, we only had to do showings for two days,” she said.
Their realtor, Jennifer Johnson, says unlike past years, houses that are maintained and updated are selling quickly this year.
Last year and in 2010, selling homes in two days just “wasn’t happening,” Johnson said.
It’s still a buyer’s market in eastern and southern Dallas County and in southern Tarrant County. Home sales have not bounced back there.
But it’s still a busy time for mortgage lenders –– many are saying they can’t write and process loans fast enough.