Dallas at low risk for home-price slide
The chances of a slide in U.S. home prices are increasing, according to the latest industry measure.
But Dallas and other Texas cities are among the least-affected cities, the study shows.
There is about a 33 percent chance that overall U.S. home prices will fall during the next two years, according to PMI Mortgage Insurance Co., one of the nation’s largest home loan insurance firms.
And more than a dozen major home markets have more than a 50 percent likelihood that residential values will drop, the report released Tuesday said.
But Dallas isn’t one of the markets faced with a price bubble. Indeed, Dallas and other major Texas cities are among markets with the lowest risk of home price declines.
In Dallas and its suburbs, the odds are less than 10 percent, PMI estimates.
Dallas has fared well for more than a year in the mortgage insurance giant’s risk surveys.
Texas’ performance in the latest report is a sharp contrast to conditions in some coastal markets where housing prices have already begun to soften.
“No one should be surprised by the slowdown we’re seeing,” Mark F. Milner, chief risk officer of PMI, said in the report. “Over the past five years, home prices appreciated much faster than incomes, and that can’t continue forever.
“Over the past five years, house prices in the United States have appreciated more than 56 percent, on average, and much more in some areas,” he said. “In the same time period, incomes increased just 25 percent.”
But Texans “should feel pretty comfortable,” he said.
“From the statistics we look at, there doesn’t seem to be much to be concerned about where you are,” Mr. Milner said. “In Texas, the appreciation you have seen is in line with the long-term national averages.”
Home values in the Dallas-Fort Worth area have risen by an average of less than 4 percent during the last five years, according to the latest government statistics.
An index of 500 means a 50 percent chance of home prices falling in the next two years.
Area Index
Most risky
San Diego-Carlsbad-San Marcos, Calif. 603
Sacramento-Arden-Arcade-Roseville, Calif. 601
Oakland-Fremont-Hayward, Calif. 600
Santa Ana-Anaheim-Irvine, Calif. 599
Nassau-Suffolk, N.Y. 598
Riverside-San Bernardino-Ontario, Calif. 596
Boston-Quincy, Mass. 596
Providence-New Bedford-Fall River, R.I.-Mass. 590
Los Angeles-Long Beach-Glendale, Calif. 590
San Jose-Sunnyvale-Santa Clara, Calif. 589
San Francisco-San Mateo-Redwood City, Calif. 587
U.S. average 328
Least risky
Pittsburgh 61
Indianapolis-Carmel, Ind. 63
Memphis, Tenn. 68
Cincinnati-Middletown, Ohio-Ky.-Ind. 72
Cleveland-Elyria-Mentor, Ohio 74
Columbus, Ohio 74
Fort Worth-Arlington 76
San Antonio 78
Nashville-Davidson-Murfreesboro, Tenn. 86
Houston 88
Dallas-Plano-Irving 89
SOURCE: PMI Group
Article Source: stevebrown@dallasnews.com
Read MoreIn comparison, D-FW houses undervalued
If a new study is correct, North Texas homeowners shouldn’t worry about a housing bubble.
Instead of an overheated market, Dallas-Fort Worth housing is among the most underpriced in the country, according to the year-end report by Local Market Monitor LLC.
The Massachusetts-based housing analyst looked at prices in 100 U.S. residential markets before deciding that the D-FW area was among the most undervalued home markets in the country.
Other Texas cities, including Houston, McAllen and El Paso – the most undervalued market on the list – also made the ranking.
“That’s a much better position to be in than a lot of the other markets right now that are at the end of a period of expansion,” said Ingo Winzer, president of the research firm. “The places that have had the strongest appreciation over the last five years – especially in California and Florida – are very likely to give a bunch of it back.”
Local Market Monitor estimates that D-FW home values are 14 percent below the average for the cities it surveys.
Compare that to the most overpriced housing markets, which are mostly in California and Florida. They include Santa Barbara, Calif.; Naples, Fla.; Modesto, Calif.; and San Diego, which are all at least 70 percent overvalued, according to the researchers.
Along with the Texas cities, other places you are likely to find home bargains include Memphis, Tenn.; Little Rock, Ark.; and Fayetteville, N.C.
Buying near Galleria
A developer from Omaha, Neb., has gone shopping for a building site across from the Dallas Galleria.
Slosburg Co. has contracted to purchase the vacant tract on the east side of Noel Road just south of Peterson Lane. The property has been marketed for sale recently by Tom Clarke of Grubb & Ellis Co.
Slosburg has sought city planning approvals for a new apartment project to be built on the high-profile site. The company owns the nearby Dorchester apartments on Spring Valley Road.
Denison to get new office
Dallas-based CMC Commercial Realty Group has landed a big corporate project for Cigna.
The real estate developer will build a 140,000-square-foot office and call center for the health benefits company north of Dallas in Denison.
Designed by Hardy McCullah/MLM Architects Inc., the two-story building is to be constructed on the east side of U.S. Highway 75.
“We hope to get started on construction in June,” said CMC principal Jesse Pruitt.
12 buildings bought
Chicago-based investor RREEF is starting 2006 with a big North Texas purchase.
Working on behalf of an institutional investment client, RREEF has purchased a dozen industrial buildings in Farmers Branch, Carrollton and East Fort Worth.
The buildings contain almost 1.2 million square feet and are in the Valwood and CentrePort business parks.
Jack Fraker and Randy Baird of CB Richard Ellis handled the sale by Prime Property Fund.
Marketing in Oak Cliff
Shea Commercial, the developer that’s building office condominium projects in locations throughout Dallas-Fort Worth, is taking its product to Oak Cliff.
The Arizona-based company is marketing a new office condo complex on Zang Boulevard just over the bridge from downtown Dallas.
The vacant site is near Colorado Boulevard and adjacent to the Cliff Towers condominium redevelopment.
Byrne to build condos
Fort Worth-based general contractor Thos. S. Byrne Ltd. has been hired to build the Cresta Bella condominium high-rise on Turtle Creek.
Construction is scheduled to begin on the $100 million project this spring.
The building will contain 55 residences ranging from 2,600 to more than 13,000 square feet.
Contractor Byrne has worked on projects including Dallas’ Latino Cultural Center and the Kimbell Art Museum and Pier One Imports’ corporate office in Fort Worth.
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