It is a bit early to know how the recent turmoil on Wall Street may impact the mortgage underwriting process. If anything, buyers with excellent credit (FICO scores above 760) will see little if any change. They may have to verify income and do a little more work gathering documents to forward to their lenders, but mortgage money will still be very available. Credit scores in the low 700’s and into the upper 600’s may result in an extra eighth to a quarter of point on the interest rate, but with rates bouncing around 6% for 30-year fixed conventional loans, it’s difficult to complain! Overall, the trends I have spoken of in these postings over the past year will hold–more scrutiny by the loan officers and underwriters of the buyer’s capability to repay the loan at every lending institution. Look for FHA financing to become more common, but only at lower price points. The current ceiling for FHA loans is $271K, but don’t be surprised if that ceiling is lifted. The Feds want to be more involved in the lending process (where were they when the laws were written–more on that in a minute), but at the same time, don’t want to be painted as the villain in cutting potential buyers out of the market.
Of course, this is where the whole problem began. Congress decided a few years ago to make the American Dream affordable and available to everyone, an entitlement of sorts, rather than a privilege. Community Reinvestment laws meant new (softer) regulations for Fannie Mae and Freddie Mac. Some loan officers and some lenders didn’t care if you were qualified or could pay the loan back. Subprime paper was elevated to A-rated paper, packaged and sold to hungry institutional investors. Home prices always go up, right? Today, we’re discovering that certain conscientious members of Congress saw the train coming with this lax policy, but they were rebuffed in trying to implement changes. And in testimony on the Hill today (9/23), one influential member of the Senate was blaming this whole problem on the “lowly mortgage”, instead of looking inward. The same congressmen who want to hold hearings should themselves be on the other side of the table. So, here we are, getting ready to face more regulation, when the law makers and regulatory bodies already in place failed to do their jobs. The fox wants to guard the hen house.
We are putting up with airport screening because we are afraid to profile, and we will endure a little more bureaucracy in the home buying process because we were afraid to (financially) profile.
Anyway, in August, not all was grim in our world. Dallas sales were down double digits, continuing a several-month’s long trend, but average sales prices were hanging in there. For the year to date, Uptown/Oak Lawn’s average sales prices were up 12%, East Dallas up 1%, North Dallas up 4%, Northwest Dallas up 5%, Frisco up 2% and Southlake up 3%. Not bad. And, “months inventory” numbers are declining, a good thing, as supply and demand are heading back to equilibrium.
September stats will be out in two weeks, and I will try to get this report out to you a little earlier in the month than I did with this August report.
Here are the details for single family homes and condo/townhome sales in selected areas. For a more comprehensive look at any one market, give me a call at my Allie Beth Allman office. Scroll down for the “Sales by Price Category” info. DOM is short for Days on Market. Avg Price pertains to sales occurring in the period(s).
Overall Market (North Texas):
Aug 08 vs 07: Sales down 18%, avg price down 1%, DOM 77, up 10%.
YTD 08 vs 07: Sales down 15%, avg price down 1%, DOM 81, up 11%.
Uptown, Downtown and Turtle Creek (Condos and Townhomes):
Aug 08 vs 07: Sales down 43%, avg price up 30%, DOM 108, up 9%.
YTD 08 vs 07: Sales down 33%, avg price up 12%, DOM 107, up 9%.
Highland Park and University Park, Bluffview, Devonshire and Greenway Parks:
Aug 08 vs 07: Sales down 10%, avg price down 9%, DOM 107, up 60%.
YTD 08 vs 07: Sales down 16%, avg price down 2%, DOM 93, up 41%.
East Dallas (incl M’s and Lakewood):
Aug 08 vs 07: Sales down 26%, avg price up 12%, DOM 70, up 15%.
YTD 08 vs 07: Sales down 18%, avg price up 1%, DOM 76, up 25%.
North Dallas (South of LBJ):
Aug 08 vs 07: Sales down 39%, avg price up 11%, DOM 121, up 92%.
YTD 08 vs 07: Sales down 28%, avg price up 4%, DOM 98, up 44%.
Far North Dallas (incl Addison and to Park Blvd in Plano):
Aug 08 vs 07: Sales down 25%, avg price down 10%, DOM 72, up 47%.
YTD 08 vs 07: Sales down 29%, avg price down 1%, DOM 73, up 35%.
Aug 08 vs 07: Sales down 44%, avg price down 14%, DOM 69, up 50%.
YTD 08 vs 07: Sales down 34%, avg price up 5%, DOM 76, up 31%.
Northeast Dallas (incl Lake Highlands):
Aug 08 vs 07: Sales down 24%, avg price up 1%, DOM 59, up 59%.
YTD 08 vs 07: Sales down 20%, avg price down 1%, DOM 57, up 14%.
Aug 08 vs 07: Sales down 14%, avg price up 1%, DOM 64, up 31%.
YTD 08 vs 07: Sales down 15%, avg price unchanged, DOM 67, up 31%.
Aug 08 vs 07: Sales down 23%, avg price up 5%, DOM 80, up 4%.
YTD 08 vs 07: Sales down 8%, avg price up 2%, DOM 89, up 22%.
Aug 08 vs 07: Sales down 23%, avg price up 4%, DOM 53, up 2%.
YTD 08 vs 07: Sales down 21%, avg price down 4%, DOM 64, up 21%.
Aug 08 vs 07: Sales up 6%, avg price up 10%, DOM 78, up 37%.
YTD 08 vs 07: Sales down 18%, avg price up 3%, DOM 71, up 1%.
Here is a look at Single Family home sales by price category for YTD 2008 vs 2007:
$200-299K (16.5% of sales): down 15%, 6 months inventory
$300-399K (6.9% of sales): down 15%, 8 months inventory
$400-499K (3.1% of sales): down 15%, 10 months inventory
$500-599K (1.4% of sales): down 15%, 13 months inventory
$600-699K (0.9% of sales): down 15%, 16 months inventory
$700-799K (0.7% of sales): down 14%, 13 months inventory
$800-899K (0.3% of sales): down 27%, 19 months inventory
$900-999K (0.2% of sales): down 22%, 21 months inventory
$1MM and up (1.1% of sales): down 12%, 20 months inventory
Here is a look at Condos and Townhomes sales by price category for YTD 2008 vs 2007.
$200-299K (17.4% of sales): 547 units vs 599 units year ago, 10 months inventory
$300-399K (6.9% of sales): 216 units vs 313 units year ago, 17 months
$400-499K (2.5% of sales): 78 units vs 111 units year ago, 22 months
$500-599K (2.0% of sales): 62 units vs 60 units year ago, 18 months
$600-699K (0.7% of sales): 23 units vs 26 units year ago, 31 months
$700-799K (0.2% of sales): 7 units vs 13 units year ago, 56 months
$800-899K (0.3% of sales): 10 units vs 5 units year ago, 29 months
$900-999K (0.3% of sales): 8 units vs 10 year ago, 23 months
$1MM + (0.5% of sales): 16 units vs 18 year ago, 50 months
Bob & Knoxie Edmonson
Allie Beth Allman & Assoc.
Dallas TX Homes for Sale, Condos and Real Estate
Highland Park Real Estate, University Park Real Estate,
Uptown Dallas Real Estate, M-Streets Real Estate