In 2017, jobs and corporations will continue to flow into North Texas. Home prices and mortgage rates will climb. Congress may lower taxes and relax banking regulations. The economies of some foreign trading partners may tank. And homebuilders will still not build homes fast enough to meet demand.
These are just some of the predictions from leaders of local real estate firms for the New Year. In general, they exude confidence in home sales and believe the local housing market faces mostly opportunities, instead of challenges.
“I am bullish” on the local market, said Robbie Briggs, chairman and CEO of Briggs Freeman Sotheby's International Realty. “Our market will be good this year.”
Mark Wolfe, president of RE/MAX DFW Associates, agrees. Despite the uncertainty caused by the change in power in Washington, D.C., he said, “People keep buying homes.”
What has made Texas a strong real estate market over the last several years will continue in 2017, said Mary Frances Burleson, president and CEO of Ebby Halliday Realtors. North Texas is in the middle of the country and has a great airport. The state is business friendly and people are nice, she said.
The cost of living is also lower. “Would you like to be living in Southern California?” she asked.
Ted Wilson, president of Residential Strategies, said the real estate business is experiencing “good times,” but warns that those who excel at the details — “the blocking and tackling” of the business — will be the winners.
As an adviser to some of the largest homebuilding firms, Wilson expects that builders will increase the number of new homes and developers will put a greater number of lots on the ground, which will chip away at the backlog of homebuyers.
But it now takes developers 14 months to create a new lot, instead of nine as it did in 2006. It takes 7.3 months to build a new house, instead of four months a decade ago, Wilson said.
“There is a logjam. It is a challenge,” he said.
Low home inventories are a worry. “In 44 years I have never seen it is so low,” Wolfe said.
The result: Prices continue to rise, which Wilson said is forcing some homebuilders to design smaller homes with fewer amenities to keep prices down.
The historically low mortgage rates are climbing, but Briggs said he does not think “they will go crazy.”
Briggs believes the positives of the local housing market far outweigh the negatives. Congress and the new administration appear to be pro-business. Oil prices are rising. The millennial-age buyers are purchasing their first single-family home. And higher interest mortgage rates may persuade some buyers and homeowners, who have been delaying getting into the market, to jump in, he said.
Burleson noted that Texas cities rank at the top of the nation's most livable places, which attracts new homebuyers and keeps those already living here.
To be in the real estate business in Texas in 2017, she said, “I feel very blessed.”
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