Dallas Fort Worth Real Estate & Property Management

DFW Real Estate Predictions - Who Knows??

It seems that I read a different prediction each day in a newspaper or magazine regarding the recovery of the real estate market. It doesn't matter which political party you subscribe to, I believe that we have some of the smartest economic and financial minds in the world working on the problem. They all have different opinions and methodologies but as of today, I don't think any of the solutions implemented or proposed by either party have been too wildy succesful. It's frightening that educated people can't figure this out much less explain it. It makes people like you and me seems like real bone heads.

In today's paper it was noted that "Every commercial real estate building in the nation has lost 30 percent of it's value." Dallas Fort Worth has been impacted too. In the same paper it says that area homes have hit rock bottom according to the S&P/Case-Shiller home price index. But I bet that when the North Texas Real Estate Information Systems (NTREIS aka MLS) report comes out it will show something different. So which is right, which do we believe, which do we use to make decisions as to where to put our hard earned money?

Mark Doutzor, chief economist at the Real Estate Center at Texas A&M University (disclosure, my alma mater) said the news is better for home buyers but he also adds just a few short lines later that "The banks are turning down the screws even tighter on builders. What we have seen in declines in home construction is going to continue."

In Dallas Fort Worth, one in every four homes on the market is a bank owned property. Until that product is flushed out, property values are at risk.

But what about commercial real estate, my education tells me that it's impact will also impact the lending market and global economy even further. So far this year, the number of commercial real estate deals posted for foreclosure has grown more than 1o percent. But industry leaders worry that's just a preview of what's to come. "The vast majority of buildings bought after 2005 are absolutely not worth the debt," said Paul Whitworth, president of commercial real estate firm Jones Lang LaSalle's Dallas office. "Don't be shocked that there will be hundreds of millions of dollars in foreclosures in commercial real estate in 2010. Dallas just had a $41 Million piece of land put on the foreclosure list. The largest posting in at least a decade.

But wait, isn't this a global economy? The New York Times reports that there is almost daily news to confirm that Europe's commercial market is returning to health.

So what does it mean? I don't have a clue but I do believe this is the best time to buy a home. Rates are at record lows and they can't stay that low for much longer. The government is offering $8000 cash back to qualified buyers on primary residences and there is a lot of inventory. Remember that one in every four homes in Dallas Fort Worth is a bank owned property and those banks must get rid of that inventory. HUD homes are available in certain cases for $100 down and other municipalities are offering incentives to buyers with down payment assistance programs.

Don't wait for more confusing reports in the same newspaper on the same day, take things into your own hands and focus on the positive aspects. Real estate is coming back!