Dallas-area home price increases have accelerated and now exceed the nationwide rate.
Dallas home prices rose 13.4% year-over-year in the latest Standard & Poor’s CoreLogic Case-Shiller Home Price Index. The gain from March 2020 prices was the largest ever in the monthly report.
Dallas prices rose almost 2% just between February and March, according to Case-Shiller.
Nationwide, home prices were up 13.2% in March — the biggest such increase in more than a decade.
A severe shortage of homes for sale and surging demand has caused U.S. residential prices to increase at unheard-of levels.
“More than 30 years of S&P CoreLogic Case-Shiller data put these results into historical context,” S&P’s Craig J. Lazzara said in the report. “The national composite’s 13.2% gain was last exceeded more than 15 years ago in December 2005.
“The unusual strength is reflected across all 20 cities” in the Case-Shiller report, Lazzara said. “These data are consistent with the hypothesis that COVID has encouraged potential buyers to move from urban apartments to suburban homes.
“This demand may represent buyers who accelerated purchases that would have happened anyway over the next several years. ”
Near-record-low mortgage rates and an increase in consumer savings during the pandemic gave homebuyers more financial footing.
They’ll need it, with prices soaring in major metro areas.
Phoenix home prices were 20% higher than in March 2020 and prices were up 19.1% in San Diego and 18.3% in Seattle.
Dallas-area home prices are at record levels in the Case-Shiller index, almost doubling in the last decade.
Case-Shiller looks at the actual value of specific single-family homes over time. The index does not include condominiums and townhouses. It only covers preowned properties — no new construction.
Median home prices in the Dallas-Fort Worth area rose 13.5% in the first quarter to a record $310,000, according to data from the Texas Realtors association.
The inventory of homes for sale in North Texas has fallen by almost 70% from 2020 levels, when the market was already tight.
“The pressures that have pushed home prices upward at their fastest pace in years remain in place, and prices continue to press higher,” Zillow economist Matthew Speakman said in an email. “Nationally, nearly half of all homes that go under contract are doing so in less than a week and nearly a third of homes are selling for above their initial list price — more than twice the share from a year ago.
“What’s more, mortgage rates have held near all-time lows and the gradual reopening of the economy has encouraged many would-be buyers to enter the mix,” he said. “All told, there is little, if any, indication that home prices will slow their appreciation anytime soon.”
If anything, home price increases are headed even higher, especially in markets like Dallas-Fort Worth where thousands of new residents are arriving from locations on the coasts and the Midwest.
“While inventory challenges remain the focal point of housing market trends, it’s important to highlight the massive buildup in demand this year — which is trending 20% above 2017-2019 levels — and is contributing to widespread bidding wars among buyers,” CoreLogic Deputy chief economist Selma Hepp said. “With demand in high gear and no respite in sight, home price growth is likely to remain in double digits over the coming quarter.
“Massive home buying demand shows no signs of abating despite some rise in mortgage rates and concerns of overheated home price growth.”
Source: Dallas Morning News