Oil Slump’s Impact on Dallas-Fort Worth Housing
I recently gave an interview that appears in RealtyTrac’s February 2016 Housing News Report (“Will Oil Slump Hurt Texas Housing?” by Octavio Nuiry, Managing Editor).
An excerpt from this article is below and provides my comments about Dallas-Fort Worth. (The full article discusses the other regions of Texas.) RealtyTrac is an invaluable publication that I find quite useful. Those who are interested in housing news should consider subscribing to RealtyTrac.
While West Texas is struggling, North Texas is booming. The Dallas-Fort Worth metro is among the top hubs for corporate headquarters in America. In Plano, bulldozers are clearing vast lots to house the new North American headquarters for Toyota, which is moving from Southern California. Dallas-Fort Worth hosts 21 companies in the Fortune 500, including American Airlines, Exxon Mobil, J.C. Penney and high-tech giants such as Texas Instruments.
“The Dallas economy is most highly correlated to the U.S. economy,” said [Mark G. Dotzour, a former chief economist at the Real Estate Center at Texas A&M University]. “Dallas is the least impacted city to the volatility of oil and gas price fluctuations. In Dallas, the inventory levels of unsold homes is way low; it’s one-to-three months.”
Ben Caballero, chief executive officer and president of HomesUSA.com in Addison, Texas, who works with 44 different new home builder brands in the four major Texas markets, said the state’s economy is strong and doing much better than the rest of the nation. He stressed that the current weakness in some Texas major metros, like Houston, could be attributed to seasonal patterns in real estate, with sales picking up in the spring months and slowdown after summer.
“Dallas is a much more diversified market,” said Caballero, a top broker whose company has developed a computer system that allows him, and his employees, to quickly take listings from multiple builders and put them in local multiple listings services and send them to other sites like realtor.com and RealtyTrac. All leads are forwarded directly to the home builders. “Dallas is doing better than Austin.”
Caballero said both inventory and days-on-the-market has increased in all the major Texas metros. “We are seeing an up-trend in inventory,” said Caballero, whose company sold nearly 2,400 new homes in 2014, generating $929 million in sales. “Every year, we’ve had higher prices and more sales. It’s very possible 2016 will not continue that trend. There’s a lot of unknowns that could make this oil problem worse.” Builders hire Caballero to market their new properties to local real estate agents. He provides weekly sales reports to builders every Friday at 8 a.m.
