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Britt FairDecember 15, 2011
Real Estate 2012: More Uncertainty
Other Unique Home Listings
Other Unique Home Listings
Other Unique Home Listings
Other Unique Home Listings
Slow Cumulative Recovery from “Great Recession”
“Great Recession” Cuts Deeper
Consumers Saving Slows GDP Growth
Business Investment Rebounding
Consumer Confidence & Jobs “Decouple”
Headlines Since August 1Debt ceiling debate goes down to wire
No big deal - the markets barely moved, and everyone knew it would get done somehow
S&P downgrades US Treasury bonds Washington expresses disbelief, but rest of the world
already knew US was not “risk-free” Odd market reaction (Treasury rates fell!) – maybe
something more important happeningEurope pledges more “bailouts” for PIIGS
Good news that Germany is supportive, but bad news that the problems don’t seem to be fading
Panic in Markets Has Boosted Gold
10-Year US Treasury bond yields
Greece is the word
Fed’s “QE2”
Greece, Round 2
10-Year US Treasury bond history
Shows how low interest rates are by any historical measure
Job gains are too slow for comfortTracks US population growthPrivate sector up 1.8 million jobs last 12 months, but still down over 6 million jobs vs. December 2007
Misleading drop in unemployment rateDropped from 9% to 8.6% in NovNot real - people stopped looking
Slow job growth is due to “uncertainty”Uncertainty of clients’ demandUncertainty over future rules, taxes, initiatives, etc.
Current Status of Job MarketTotal Jobs Created
(Net)
Private Sector Jobs Created
(Net)Nov-11 120,000 140,000Oct-11 100,000 117,000Sep-11 210,000 220,000Aug-11 104,000 72,000
Jul-11 127,000 173,000Jun-11 20,000 75,000
May-11 53,000 99,000Apr-11 217,000 241,000Mar-11 194,000 219,000Feb-11 235,000 261,000Jan-11 68,000 94,000Dec-10 152,000 167,000
12-Mo Total 1,600,000 1,878,000
Metro Employment Change(10/10-10/11)
Source: Bureau of Labor Statistics
Four Metro Areas With Largest Employment GrowthHouston 79,500Dallas/Fort Worth 48,800Boston 47,000Los Angeles 39,400
Three Metro Areas With Largest Employment DeclinesAtlanta (22,100)Virginia Beach (6,700)Indianapolis (5,300)
Employment Change (10/10-10/11)
12 Largest US Metro Areas
Source: Bureau of Labor Statistics
Stock market wealth effect:3-year recovery helped “rich get
richer”
NTREIS Dollar Volume Since 2004 NTREIS Dollar Volume Since 2004
DFW Sales By Price 2011 (page 1)
Sale Price Range# sales YTD
(11 mos 2011)% change vs.
prior year$1 to $19,999 729 -7%
$20,000 to $29,999 1533 19%
$30,000 to $39,999 1850 6%
$40,000 to $49,999 1722 7%
$50,000 to $59,999 1856 14%
$60,000 to $69,999 2115 8%
$70,000 to $79,999 2,240 5%
$80,000 to $89,999 2,488 -2%
$90,000 to $99,999 2,520 -1%
$100,000 to $109,999 2,403 -5%
$110,000 to $119,999 2,764 -7%
$120,000 to $129,999 2,860 -12%
$130,000 to $139,999 2,760 -6%
$140,000 to $149,999 2,553 -6%
DFW Sales By Price 2011 (page 2)
Sale Price Range# sales YTD
(11 mos 2011)% change vs.
prior year$150,000 to $159,999 2,391 -5%
$160,000 to $169,999 2,281 -5%
$170,000 to $179,999 1,906 -8%
$180,000 to $189,999 1,755 -7%
$190,000 to $199,999 1,501 3%
$200,000 to $249,999 5,871 0%
$250,000 to $299,999 4,153 1%
$300,000 to $399,999 4,226 1%
$400,000 to $499,999 1,914 10%
$500,000 to $599,999 957 14%
$600,000 to $699,999 603 14%
$700,000 to $799,999 323 -6%
$800,000 to $899,999 234 -2%
$900,000 to $999,999 164 32%
$1,000,000 and more 583 3%
Total 59,249 0%
Today’s Market: NTREIS Sales YTD November 2011
# of Sales
% Change vs. Prior
YearAverage
Sale Price
% Change vs. Prior
Year
Average Days on Market
% Change vs. Prior
Year
53 McKinney 1,716 3% $223,451 -1% 80 10%
51 Allen 1047 1% $246,590 1% 73 11%
55 Frisco 2,575 7% $289,387 2% 75 9%
20 Plano 2,495 4% $270,130 0% 74 14%
22 Carrollton/F.Branch 1,272 3% $188,114 -8% 80 18%
10 Dallas Far N 766 3% $332,530 2% 86 8%
23 Richardson 809 8% $173,399 -3% 74 37%
18 Dallas NE 474 12% $239,991 -9% 75 23%
16 Dallas NW 442 6% $208,478 -5% 85 21%
11 Dallas N 502 -5% $800,820 3% 111 -13%
12 Dallas E 1,590 2% $251,470 8% 93 27%
25 Park Cities 628 4% $1,069,514 -2% 98 -19%
17 Uptown (condos) 719 5% $301,832 -5% 122 10%
14 Oakcliff N 828 -11% $105,165 8% 72 7%
DFW housing since 1999: No DFW housing since 1999: No Boom/BustBoom/Bust
Source: S&P Case-Shiller
DFW home prices down 7.9% from Jun’07 peak, but up 3.8% from Feb’09 bottom
Fewer DFW homeowners are Fewer DFW homeowners are “underwater”“underwater”
Source: CoreLogic
Highest % of homeowners owing more than house is worth:Nevada 58%Arizona 47%Florida 44%Georgia 30%
Lowest % of homeowners owing more than house is worth:New York 6.3%North Dakota 6.9%Oklahoma 7.3%Alaska 7.5%
Areas of local interest:Texas 9.5%DFW area 11%
Summary & Predictions 2012 housing market will look a lot like 2011
European sovereign debt crisis will continue to cause uncertainty Mudslinging in US election season will keep negativity Interest rates will remain remarkably low throughout 2012
DFW economic recovery will outpace national average Job creation and general business environment are much better here Oil and gas industry also boosts DFW City and state finances are healthier than others in US
Home prices appear to have stabilized in DFW Further free fall of home values appears unlikely
This remains one of the best times in US history to buy a home with the combination of ultra-low mortgage rates and reasonable home prices