According to David Fair, attorney at Hexter Fair Title Company, there is a BIG difference between the Dallas economy & housing market and the rest of the country. The strong DFW (Dallas/Fort Worth) economy is keeping our real estate prices up.
We have strong job creation here, continuing corporate and individual relocations, and a vibrant oil & gas industry (especially in the Barnett Shale which created 83k jobs in 2007 and generated $8.2 billion into the local economy).
In 2007 Dallas area created 230 net new jobs per day, and 472 net new residents per day. Figures for 2008 are not yet in.
According to Fair, DFW has only 3.1 months' inventory of new home (finished and vacant) inventory, per the Metrostudy and builders have shown significant restraint in keeping housing starts low. For existing home sales, there is a 6.2 months' inventory (and 6 months is generally considered equilibrium).
To support his opinion, Fair provided the following from the Metrostudy results:
Job creation 9/07 to 8/08
Top 10 states
|
Rank |
State |
12-Mo Job Growth |
Growth Rate |
|
1 |
Texas |
243,100 |
2.3% |
|
2 |
New York |
39,700 |
0.5% |
|
3 |
Washington |
35,700 |
1.2% |
|
4 |
Colorado |
26,700 |
1.1% |
|
5 |
Maryland |
25,700 |
1.0% |
|
6 |
D. C. |
21,600 |
3.1% |
|
7 |
Virginia |
19,000 |
0.5% |
|
8 |
Louisiana |
18,200 |
0.9% |
|
9 |
Oklahoma |
10,500 |
0.7% |
|
10 |
Kentucky |
8,500 |
0.5% |
Job creation 9/07 to 8/08
Top 10 Metro Areas
|
Rank |
Metro Area |
12-Mo |
Growth |
|
1 |
Dallas-Fort Worth |
59,800 |
2.0% |
|
2 |
Houston-Baytown |
53,400 |
2.1% |
|
3 |
Washington DC |
44,600 |
1.5% |
|
4 |
Seattle-Tacoma |
43,800 |
2.5% |
|
5 |
NY-North Jersey |
33,600 |
0.4% |
|
6 |
Austin-Round Rock |
18,100 |
2.4% |
|
7 |
San Antonio |
17,000 |
2.0% |
|
8 |
Virginia Beach-Norfolk |
16,800 |
2.2% |
|
9 |
Denver-Aurora |
13,700 |
1.1% |
|
10 |
New Orleans-Metairie |
12,100 |
2.3% |
The 5 metro areas with the lowest risk* of a price decline in the next two years (from the PMI U.S. Market Risk Index):
46.San Antonio : <1% chance
47.Pittsburgh, PA: <1% chance
48.Houston-Sugar Land-Baytown: <1% chance
49.Dallas-Plano-Irving: <1% chance
50.Fort Worth-Arlington: <1% chance
*Risk measured as the % chance that home prices will be lower in 2 years.
The DFW residential market is poised to rebound in the spring of 2009 as "certainty" (from federal bailouts, interest rates, job security, election results, etc.) returns over the coming months, We all hope that Mr. Fair's prognostications are correct.
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