Housing Boom Bigger in Texas as Home Bidding Wars Erupt

[Purveyor]

By Prashant Gopal - Oct 9, 2013
After losing his third bidding war for a Dallas-area home, Johnny Tseng offered the winner $10,000 to walk away. The buyer declined.

“I thought I made an attractive offer,” said Tseng, a 31-year-old financial analyst for a Dallas-based commercial bank. “But if I were under contract right now and somebody came along and offered me money, I would be hesitant. There just aren’t that many options out there.”

Texas, known for its open spaces and cheap property, is experiencing the types of real estate bidding frenzies seen in tightly built markets from New York to San Francisco as job gains generate a suburban land rush. Existing-home prices in Dallas and Houston are rising faster than at any time since the oil boom of the 1980s. Homebuilders, caught off guard by the ferocity of buyer demand, are exhausting construction-ready lots as they struggle to recruit workers to complete houses quickly.

The boom shows that the U.S. real estate market’s rebound is extending beyond areas such as Arizona, Florida, California and Nevada, where prices are soaring after being hardest-hit by the crash that started in 2006. Texas, which largely avoided the collapse, is benefiting from employment growth and an expanding population, the more traditional forces of housing demand.

Residential sales across the Lone Star State reached a record in the second quarter. At the current pace, it would take about three months to sell the inventory of existing homes on the market in Houston and Dallas, less than the U.S. level of 4.9 months and the lowest since at least 1990, according to data from the Texas A&M University Real Estate Center.

more...

http://www.bloomberg.com/news/2013-10-09/housing-boom-bigger-in-texas-as-home-bidding-wars-erupt.html

[Xipe Totec]

1. Housing Bubble - You got that right.

When they start blabbing about a land rush in Texas, it's time to run the other way.

[leftstreet]

2. 'Institutional investors may be playing a part...'

...in shrinking inventories and driving up prices'

Oh yeah

[texanwitch]

3. I live in a old neighborhood changing to townhouses.

The townhouses are not cheap, just made cheap.

The cheapest ones are $300,000 to $400,000.

No yard, just a few feet from window to window.

I just wonder what the current problem in Washington will do to the home buying crowd.

The interest rates might go up.

We will see.

[msongs]

4. speculators, not owner-occupants, driving up prices and rents. ughly nt