Interest Rates Hit New 12 Month Low!

According to Freddie Mac’s Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at their lowest for 2019. Rates like these haven’t been seen since February 2018!

Last week’s survey results reported an interest rate of 4.35%. This is a welcome change from the near 5% rates seen in mid-November. At 4.32%, the second week of February 2018 was the last time rates were this low. This can be seen in the chart above.

Freddie Mac’s Chief Economist, Sam Khater, had this to say:

“Mortgage rates fell for the third consecutive week, continuing the general downward trend that began late last year.

Wages are growing on par with home prices for the first time in years, and with more inventory available, spring home sales should help the market begin to recover from the malaise of the last few months.”

Bottom Line

If you plan on buying a home this spring, meet with a local real estate professional who can help prepare you for today’s market before rates increase!

Just the Facts: Dallas Continuing to Grow

Dallas-Area Home Price Still Racing Up

9.8% Increase in January; Economists Predicted 3-4% Increase for DFW


Dallas-area home prices rose by almost 9.8 percent in January, continuing to grow faster than nationwide rates.   The analysts had predicted the DFW area would slow to a 3% to 4% increase in 2016, but are now revising – there is simply too many jobs coming to North Texas.  Analysts expect that North Texas’ near double-digit home price gains will continue as long as employment growth in the area remains strong.  CoreLogic said Tuesday that U.S. home prices were 6.9 percent higher in January than they were at the start of 2015.  “Heading into the spring buying season, home prices continue to rise across much of the country,” said Anand Nallathambi, president and CEO of CoreLogic. “With rates staying low for now and continued solid job and income growth, the spring buying season is shaping up to be a good one.”  CoreLogic is forecasting that nationwide home prices will rise by 5.5 percent in the year ahead.

–          Dallas Morning News, March 1, 2016 (excerpt of article)


Castle Hills Developer Has Bought Singer Ranch; Negotiating with Clem Ranch.

Will Be Larger Than Valley Ranch

About 3,400 houses have been completed in the Castle Hills community.    Another 1,500 lots are in development.  Now Chris bright has announced the purchase of the Singer Ranch (Old Denton Rd, just south of Windhaven) and negotiations underway for the Clem Ranch (Josey at Parker Rd)

Bright Realty just acquired the next door Singer Ranch, a more than 100-acre property on Old Denton Road.  The former horse boarding and riding facility is surrounded to the east on three sides by Castle Hills.  Bright Realty CEO Chris Bright said the purchase will give Castle Hills land for more than 300 additional homebuilding sites.  “We moved fast to buy it,” Bright said. “We knew the way things are working right now in single-family home development that it would sell fast.  Bright Realty is already working with the City of Carrollton to plan and zone the property – much of which is located in a floodplain and is wooded creek area.

Bright said he’s working with the Clem family, which owns about 140 acres north of Castle Hills to expand the project further.   “That family has owned that property since 1860,” he said. “We are doing a joint venture with them that will give us another 400 to 500 lots north of Parker Road.”

More than 12,000 people now live in Castle Hills.  In addition to the custom home communities, Bright Realty is building shopping apartments and an office park to complement the residential neighborhoods.

–          Dallas Morning News, March 2, 2016 (excerpts)


 No Dallas Bubble Most Housing Analysts Say in New Poll

North Texas were up 11 percent on 2015.  With a year of double-digit home price gains, concerns about housing costs in North Texas are growing.   Most housing experts polled for the study by Zillow said Dallas has no significant risk of a housing bubble in the next five years.  The rest said Dallas is either already in a bubble or will be in the next few years.    That is a better forecast than almost any other major city.    “It is very clear that nationally we are not seeing a return of the conditions that caused the last national bubble,” Gudell said. “Tighter lending restrictions today mean we aren’t seeing buyers get loans they realistically can’t pay back, like we did in years past.  “It’s significant that some experts are starting to worry about bubble conditions, but in my opinion, there’s no real danger of a severe crash like the one we all remember from the last decade.”  But continued employment gains and population increases will keep housing demands strong in Dallas.  Some 20 of the analysts saw no risk for Dallas in for more than five years.

–          Dallas Morning News, December 9, 2016 (excerpts)

Just the Facts: DFW Still Short of Homes

Report: DFW Still Short of Homes Despite Record Construction

Dallas-Fort Worth was still short over 40,000 home listings by the end of 2015, even as the number of single-family homes under construction set a regional record, according to one housing research firm.  By the end of 2015, there were 14,180 single-family homes under construction, which represents a 7.2-month supply, but it wasn’t enough to counteract the North Texas’ home shortage, said Ted Wilson, principal at Dallas-based Residential Strategies, which tracks and analyzes Dallas-Fort Worth’s housing market.   “Shortages of construction labor continue to provide challenges for homebuilders,” Wilson said. “Unfortunately, there appears to be no near-term alleviation for this challenge.”  The record rains in spring 2015 also set back the number of completed homes. For 2015, builders started 27,672 new homes, which was an increase 6.6 percent year-over-year, according to Residential Strategies’ data.   By year=end 2015, builders closed $23,565 single-family homes, which increased 7.9 percent year-over-year.  


Builders’ estimated the number of closings were 15 percent to 20 percent below their business plan because of construction delays tied to weather and a tight labor supply, Wilson said. And, so far, there’s no end in sight, he said.  “Shortages of construction labor continue to provide challenges for homebuilders,” Wilson said.  Wilson said North Texas’ homebuilding industry outlook appears “quite bright” for the next few years as companies continue to relocate employees to the region.   “This steady influx of workers should help sustain housing demand,” he said.

–          Dallas Business Journal, January 8, 2016


North Texas Home Sales Surged in December to Set Record for 2015

North Texas home sales jumped 21 percent in December as homebuyers scrambled to get purchases closed before the end of the year.  December’s surge in sales was enough to push 2015 home purchases to a record 96,156 preowned homes, according to data from the Real Estate Center at Texas A&M University.  Almost $25 billion in houses were sold last year.  “We knew the market was very strong,” Russell Berry, president of the MetroTex Association of Realtors, said in a statement. “We astounded to see sales volume at nearly $25 billion for the year.”  Home sales in the area in 2015 were almost 15 percent greater than in 2006, the peak local housing year before the recession.  Real estate agents sold 8,543 preowned in December – the highest sales volume in three months. December usually sees declines in home purchases because of the holidays.  Median home sales prices in the final month of 2015 were $210,000 – 9 percent ahead of December 2014, according to data supply by the North Texas Real Estate Information System.

–          Dallas Morning News, January 8, 2016


January Pendings Are Up 28 Percent

Early indications show another strong month for home sales in January.  The number of pending home purchases – under contract but not yet completes – was 28 percent higher than a year ago.  The early start for 2016 no doubt ease fears of a housing sector cool down caused by the huge declines in oil prices and cutbacks in Texas’ energy industry.  Worries about rising interest rates may have helped fuel the dramatic rise in December home sales.  “The uptick in Federal Reserve rates pulled people off the sidelines,” said Ted Wilson, a housing analyst with Dallas’ Residential Strategies Inc. “They think it’s time to buy.”

–          Dallas Morning News, January 8, 2016

TRID: Adding Time and Costs

The first effects of the new Know Before You Owe or TILA RESPA Integrated Documentation (TRID) rules are now measurable. The changes created some confusion among lenders and closing agents and the average time-to-close has risen as a result. The industry is at the short end of the learning curve, so this impact will likely ease with time.

The new TRID rules have been in effect since October 3rd. Historically, a typical close took roughly 30 days so few closings in October would reflect the new TRID process. However, with November complete we can begin to measure the impact.

A special data sample was utilized to create a time series for time-to-close; the time in days from when a listing goes under contract until it is complete. A primary driver of time-to-close is the volume of mortgage applications, both refinances and purchases. Both series are charted below in 4-week moving averages to mute the weekly volatility.


Here are some of the principal takeaways:

  • Applications volume typically falls in November
  • In 2013 and 2014, time-to-close fell with applications volume
  • Applications volume fell in November of this year, while time-to-close spiked
  • There was a bulge of applications in August through October, but these should have been worked out by November and they did not impact earlier timelines
  • Time-to-close rose to an average of 40.5 days in November of 2015 from 35.9 in November of 2014, a 12.8% increase.
  • Time-to-close peaked at 41.2 days in the 4th week of November

While early indications are that TRID has delayed some closings, anecdotal evidence suggests that sales are still likely to close. Consequently, the impact to home sales volume and statistics should be transitory. The change will cause a one-period shift in sales to the next month and each subsequent month will have a full month’s tally of sales. As time-to-close declines, there may be a modest increase to monthly sales as the market catches up. This shift may modestly impact the seasonal factors used to adjust economic time series of home sales.

In the long-term, lenders and closing agents may adjust to the new environment reducing the time-to-close. In the near term, consumers are likely to require a 45-day lock period rather than the standard 30-day. This could add $100 to $300 onto the cost of closing.

–Source: Ken Fears in Economist Commentaries 22 Dec 2015–

North Texas Wealthiest Zip Codes

Check out North Texas wealthiest zipcodes. Congrats if you live in one of them!! If you don’t and would like to, give me a call at 972-824-6466.


Locally Researched by: Erin Sood, Dallas Business Journal – Nov 13, 2015

Do you think waiting to buy or sell until after the Holidays is a good idea?

Waiting until after the Holidays, Isn’t a Smart Decision | Keeping Current MattersEvery year at this time, many homeowners decide to wait until after the holidays to put their home on the market for the first time. Others who already have their home on the market decide to take it off the market until after the holidays. Here are six great reasons not to wait:

1. Relocation buyers are out there. Companies are not concerned with holiday time and if the buyers have kids, they want them to get into school after the holidays.

2. Purchasers that are looking for a home during the holidays are serious buyers and are ready to buy.

3. You can restrict the showings on your home to the times you want it shown. You will remain in control.

4. Homes show better when decorated for the holidays.

5. There is less competition for you as a seller right now. Let’s take a look at listing inventory as compared to the same time last year:Supply of Homes | Keeping Current Matters

6. The supply of listings increases substantially after the holidays. Also, in many parts of the country, new construction will make a comeback in 2016. This will lessen the demand for your house.

Bottom Line

Waiting until after the holidays to sell your home probably doesn’t make sense.


-Keeping Current Matters, 5 Nov 2015-

Just the Facts: Interest Rates, Unemployment, and Housing Prices

Interest Rates Should Rise in December

You can’t argue with monthly growth of 271,000 jobs and an unemployment rate of five per cent. That was Wall Street’s response to the release, on Friday, of the U.S. employment report for October. The yield on Treasury bonds rose sharply as traders priced in a December rate hike by the Federal Reserve, which would be the first in almost a decade. Indeed, some analysts were speculating about a second quarter-point rise come March or April.  That last bit of prognostication was premature, but it does seem highly likely that Fed chair Janet Yellen and her colleagues will act: as recently as Wednesday, Yellen described a December rate hike as “a live possibility.”

–          New Yorker Magazine, November 6, 2015


October Job Boom; Unemployment Drops

October hiring burst adds 271,000 jobs, drops Unemployment rate drops to 5-year low

U.S. hiring roared back in October after two weak months, with employers adding a robust 271,000 jobs, the most since December. The unemployment rate dipped to a fresh seven-year low of 5 percent.  The burst of hiring across a range of industries came as companies shrugged off slower overseas growth and a weak U.S manufacturing sector. Big job gains occurred in construction, health care and retail.  Healthy consumer spending is supporting strong job growth even as factory payrolls were flat last month and oil and gas drillers cut jobs.  Any gain above roughly 150,000 was expected to keep Fed policymakers on track to raise interest rates from record lows at their mid-December meeting.  A survey by the Institute for Supply Management found that companies in the health care, retail, financial and transportation and warehousing industries all added more jobs in October than in September. Overall, services firms expanded last month at the fastest pace in three months. That’s in sharp contrast to the ISM’s survey of manufacturing firms, which barely grew in October.  Chair Janet Yellen and other leading Fed officials have said that the economy is generally healthy and that the December meeting is a “live possibility” for a rate hike.

–          Dallas Morning News, November 6, 2015


And Texas Home Prices Keep Going Up

Unsustainable. Overheated. Overvalued.

Those aren’t the usual descriptions used for the Dallas housing market.  But that was before local home prices started jumping more than 10 percent a year and before buyers were bidding up the cost of putting a roof over their heads.  The Dallas area now leads the nation in home price gains, according to analysts at Core Logic Inc.  And it’s not just Dallas that’s seeing higher prices. Costs are soaring in Austin and San Antonio, too.  Even in Houston, where the economy’s been slapped around by oil and gas industry layoffs, home prices are rising more than 6 percent a year.  The cover of the latest issue of Texas Monthly magazine calls it “The Great Texas Housing Boom.”  In Texas, the home price binge is being fueled by pure demand from the people moving here every year.  “We have thousands of people moving to this state, and we are not building enough places for them to live,” said Texas economist Mark Dotzour. “That’s what is driving up prices.  “Our housing inventory is ridiculously low, and that’s what’s causing these spiky prices.”  Dotzour doesn’t see a cool-down in Texas home price gains as long as the flow of people from California, Illinois and elsewhere continues.  “This is going to go on as long as jobs keep coming into the state,” he said. “As long as we have a shortage of home supply, I don’t know why prices won’t continue to go up. That’s just how it works.”

–          Dallas Morning News, November 5, 2015

Is Qualifying for a Mortgage Getting Easier?


There has been a lot of talk about how difficult it is to get a home mortgage in today’s lending environment. However, three recent reports have revealed that lending standards are beginning to ease. This is great news for both first time buyers and current homeowners looking to move or buy a second vacation/retirement home. Let’s look at the three reports:

The MBA’s Mortgage Credit Availability Index

This index, issued by the Mortgage Bankers’ Association, measures the availability of credit available in the home mortgage market. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of a loosening of credit. We can see that the index has been increasing nicely this year:


Fannie Mae’s latest Mortgage Lender Sentiment Survey

This survey revealed that more lenders report that mortgage lending standards across all loan types are easing. The survey asked senior mortgage executives whether their company’s credit standards have eased, tightened, or remained essentially unchanged during the prior three months. The gap between lenders reporting easing as opposed to tightening over the prior three months jumped to approximately 20%. This represented a new survey high of “net easing.” In addition, the share of lenders who expect their organizations to ease credit standards over the next three months also ticked up this quarter.

Doug Duncan, senior vice president and chief economist at Fannie Mae, addressed this easing of standards:

“For the first time in seven quarters, we see a pronounced increase in the share of lenders, particularly medium- and larger-sized lenders, reporting on net an easing of credit standards … This is a significant result in light of public discourse on credit availability and standards … Overall, we expect that lenders’ tendency toward easing credit standards, together with relatively low mortgage rates and a strengthening labor market, will continue to support the housing market expansion.”

Ellie Mae’s latest Origination Insights Report

The easing of credit standards is also confirmed in this report which showed that the average FICO score on a closed loan fell to its lowest point in well over a year. Here is a chart of average FICO scores on closed loans so far in 2015:


Just keep an eye on interest rates…

Although this is all great news, there was one challenge in the recently released data.Ellie Mae reported that the average interest rate on closed loans is beginning to inch upward:


What this means to you…

If you are a first time buyer or a current homeowner thinking of moving up to a bigger home or buying a vacation home, now may be the time to act. Mortgage lending standards are beginning to ease and interest rates are beginning to inch up.

–Keeping Current Matters; 23 September 2015–

Just the Facts: Home Values and Interest Rates

Home Values: Where Are They Headed Over The Next 5 Years?

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey.  Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

The results of their latest survey  (This is the national predictions, not necessarily Dallas.  Dallas is expected to have considerably higher appreciation.)

  • Home values will appreciate by 4.1% in 2015.
  • The cumulative appreciation will be 18.1% by 2019.
  • That means the average annual appreciation will be 3.4% over the next 5 years.
  • Even the experts making up the most bearish quartile of the survey still are projecting a cumulative appreciation of 10.5% by 2019.

Individual opinions make headlines. We believe the survey is a fairer depiction of future values.

–                      KCM Crew, August 18, 2015


What Does the Stock Market Plunder Mean for Interest Rates?

Economists at Barclays have pushed their expectation of a Fed rate rise out to March next year; their counterparts at Citigroup now believe that the Bank of England will sit on its hands until 2017.  Analysts will be picking over the wreckage of Black Monday in search of meaning for months to come. But it is already possible to discern a broad logic to what happened these last few days: the markets got scared.  China is responsible for 15 percent of the global economy but it is scaring the world economy.  The question now is what relevance any of this has to the broader global economy and whether the market rout will stay the hand of central banks – especially the US Federal Reserve and the Bank of England – which were poised to start raising interest rates as soon as, in the Fed’s case at least, next month.  And yet the markets seem to believe that the chances of a September rate rise by the Fed have fallen dramatically.

–          The Telegraph. August 25, 2015


Will the Fed Raise Interest Rates in September?

As markets quake and stock prices fall, investors increasingly are betting that the Federal Reserve will not raise interest rates this year.  Their conclusion is a striking rejection of the Fed’s stated plans — and it appears premature.  The Fed watches financial markets closely, of course. Investors are losing money they might have spent, and falling prices can be an indicator of broader economic problems.  But the losses so far probably aren’t big enough to crimp growth, and officials have plenty of time to see what happens next. The Fed’s policy making committee doesn’t meet until mid-September, and it has two more meetings scheduled later this year, in October and December.  The volatility of financial markets over the last few days contrasts with the stability of domestic economic growth over the last several years. The Fed is focused on that broader picture, and while the pace of growth remains sluggish by past standards, central bank officials have suggested repeatedly that they regard it as good enough.

–          New York Times, August 25, 2015

Just The Facts: Dallas Housing Bubble?


Dallas ‘Housing Bubble 2’ Has Bloomed Into Full Magnificence

The current housing boom has Dallas solidly in its grip.  As in many cities around the US, prices are soaring, buyers are going nuts, sellers run the show, realtors are laughing all the way to the bank, and the media are having a field day.  Nationwide, the median price of existing homes, at $236,400, as the National Association of Realtors sees it, is now 2.7% higher than it was even in July 2006, the insane peak of the crazy housing bubble that blew up with such spectacular results.  Housing Bubble 2 has bloomed into full magnificence:  In many cities, the median price today is far higher, not just a little higher, than it was during the prior housing bubble, and excitement is once again palpable. Buy now, or miss out forever! A buying panic has set in.  And so the July edition of D Magazine – “Making Dallas Even Better,” is its motto – had this enticing cover titled, “The Great Dallas Land Rush”:  “Dallas Real Estate 2015: The Hottest Market Ever,” the subtitle says.  But despite the current “buying panic,” the soaring prices, and all the hoopla round them, there is a fly in the ointment: overall homeownership is plunging.  The homeownership rate dropped to 63.4% in the second quarter, not seasonally adjusted, according to a new report by the Census Bureau, down 1.3 percentage points from a year ago. The lowest since 1967!

–          Wolf Street Article, July 30, 2015

Dallas Still Top U.S. Market For Home Price Gains


The Dallas area at midyear was still leading the country in home price gains, according to a new report by CoreLogic.  Dallas-area home sales prices were 8.6 percent higher in June than in the same month in 2014, according to a just-released report.  Nationwide home prices were 6.5 percent higher year-over-year.  “The stronger appreciation was registered in cities with limited inventory and strong homebuyer activity,” Frank Nothaft, chief economist for CoreLogic, said in a statement. Houston was second among the top cities with a 7.4 percent annual price gain, followed by New York at 6.2 percent.  The Dallas area has been topping the country in home price increases for several months in CoreLogic’s surveys.  North Texas home prices are now at record levels and the annual price increases are more than twice long term average appreciation.

–          Dallas Morning News, August 4, 2015

No Housing Bubble in Sight

Surging home sales and prices raise affordability questions.  Statistically speaking, housing is on a roll. Year-to-date home sales are up 6.3 percent and prices in May were 7.9 percent higher than a year earlier. The trends are expected to stay positive and are likely to boost business dollar volume by as much as 15 percent in 2015. These statistics don’t even include new-home construction, which is growing at a strong clip as well.  But this rosy picture does raise concerns about affordability. After all, wages are rising by only 2 percent annually and renters are getting squeezed, having to endure 4 percent rate hikes while home prices accelerate more quickly. In addition, mortgage rates have notched their highest level of the year, reaching about 4 percent in June, and should continue to rise well into next year.  Some armchair analysts have suggested that we’re entering a new housing market bubble. But hard facts suggest otherwise. Underlying conditions today are fundamentally different from the bubble of a decade ago. Back then, credit was easy to obtain and home sales were running at more than 8.5 million a year (existing and new homes combined). New-home construction volume topped 2 million annually.

By comparison, credit today is extremely tight, which has led to an unusually high level of all-cash sales. Home sales are barely over 5 million and new-home construction is barely scratching 1 million units. Meanwhile, for the past eight years, total mortgage balances have fallen. The reasons show what’s changed from 10 years ago: Home owners are paying their mortgages on time and few are seeking cash-out refinances.  It’s fair to ask, though, whether at some point affordability problems will choke off home buying. That’s possible. But here’s my thinking about what could neutralize those fears. After running various scenarios, I expect home prices to rise continuously as long as mortgage rates remain under 6 percent. Early in the summer, the average rate was 4 percent. It may rise to 5.5 percent by the end of next year. Should mortgage rates cross the 6 percent mark, maybe two years down the road, then either home prices will be flat or other forces will be evident. Going forward, keep in mind that robust job creation and meaningful increases in income levels will help propel home prices. For now, though, no bubble or impending crash is in sight.

–          Lawrence Yen, NAR, July 2015