For those of you who are hoping to buy a home in Dallas this year, you’ll be glad to know that home prices in “Big D” aren’t skyrocketing – in fact, they’re rate of appreciation is actually slowing down, which could mean more buyers are likely to enter the market. This is great news for potential buyers on a budget in the Dallas metro area, as home prices in this market usually experience fairly rapid gains. And while it may seem like a less than positive bit of news for home sellers, those who are putting their properties on the market needn’t worry; home prices and property values are still making gains – just not at the breakneck pace they once were.
According to a recent article from The Dallas Morning News, home prices in the Dallas area and across the country continued to slow in June as more inventory came into the market; however, prices of preowned homes in the area still increased by 8 percent from a year earlier. The latest Standard & Poor’s/Case-Shiller Home Price Index revealed that home prices rose an average of 8.1 percent in 20 major cities tracked by Case-Shiller. On a national level, prices were up 6.2 percent in a new monthly index that was previously only published quarterly.
“Home price gains continue to ease as they have since last fall,” said David Blitzer, chairman of S&P’s Index Committee. “For the first time since February 2008, all cities showed lower annual rates than the previous month.”
According to the Dallas Morning News article, home price gains were expected to slow after months of double-digit increases. Dallas alone saw home price gains push beyond 10 percent earlier in the year.
Wondering which cities had the biggest price gains?
The biggest year-over-year home price gains among the 20 cities surveyed by Case-Shiller were in Las Vegas (15.2 percent), San Francisco (12.9 percent), and Miami (11.9 percent). Interestingly, these markets were all hit hard by the Great Recession, but now it seems they are making a big comeback in the real estate world.
Which city had the smallest gain?
The city with the smallest increase in home prices was Cleveland, OH. The “Forest City” had a mere 0.8 percent rise in area home prices, according to the index.
Why are prices slowing down?
Not long ago, price appreciation was reaching new highs, mainly due to lack of available inventory. Now that more homes are entering the market, the supply is loosening, which could be the main factor in the price slowdown. However, it’s still too soon to say whether enough homes will come onto the market to satisfy the still strong level of demand, particularly in areas like Dallas where bidding wars still happen and average days on the market (DOM) are lower than the national average.
Another important factor is mortgage rates, which are still fairly low today. But Blitzer warns that bargain-priced mortgage rates won’t last forever.
“Recent improvements in the labor markets and comments from [Federal Reserve Chairwoman] Janet Yellen and others hint that interest rates could rise as soon as the first quarter of 2015.”
So those of you who are still on the fence or “waiting it out” to see if prices and rates continue to drop, don’t wait too much longer! Locking in a low mortgage rate before the first of the year could be wise – especially if you are shopping for home loans in the Dallas metro area. For a free rate quote and mortgage consultation, feel free to contact Kelly Decker and his team of Texas home financing professionals. Simply call (972) 591-3097 or fill out our online form and we will reach out to you after reviewing your information.
Be sure to check back often for updates on the mortgage market, Texas real estate news and more!