Recipe for Real Estate Investment Success: 1 Part Demand, 1 Part Supply

According to the U.S. Census Bureau, Dallas was the fastest growing city in America in 2009, adding over 140,000 new residents.  In fact, Dallas has added almost 1.3 million people in the last decade (also more than any other city). Why are people moving into this area? First, North Texas still has some of the the most affordable housing in the nation. Dallas, and Texas in general, never experienced the unreasonable increases in home prices that many other areas have experienced. Second, North Texas has a relatively diversified economy that has been mostly insulated from recent economic changes. Not only have existing industries done well, but DFW has also been a top target for corporate expansion. DFW ranked third in 2009 for companies wanting to build new or expand existing facilities. (Dallas Business Journal, March 3, 2010.) The result has been job creation and population growth. Take a look at this CNNMoney.com article for more information on the Census numbers.

Next, because DFW was not “overbuilt” like many metropolitan areas across the nation, the housing inventory has always stayed healthy. In fact, over the past couple of years, the builders who have survived have sold more homes than they have built. This, along with the difficulty for home buyers to get home loans, has significantly reduced supply. Many experts now predict a home shortage in Dallas and North Texas beginning possibly in late 2010 or 2011. This is in stark contrast to most of the nation where supply levels remain unhealthy.

Significant population increase (demand) plus a potential housing shortage (supply) equals investment opportunity. I’d argue in fact that there may be no better place than DFW for residential real estate investment over the next 2-3 years. A significant number of Americans have taken quite a beating in their retirement portfolios over the past few years, and many wonder how they’ll ever get back on track. It may be worth looking into making real estate investment one of your strategies. As always, make sure you have a competent team of advisors before pursuing any new real estate investment strategy. Feel free to listen to one of our podcasts discussing real estate in North Texas.

Rock n Roll Texas!

Texas is, hands down, the best place in the country for real estate investing…  There is a perfect storm going on right now in our market- A LOT of money can be made in a market like this if you know what you are doing, have the right team, and have access to capital.

Check out the latest stats

Jeremy Louder

Texas Real Estate in 2010: The Perfect Storm?

For the fifth year in a row, Texas is the leader in net relocation gain.  As unemployment continues to increase around the country, people are flocking to the best economy in the U.S.  Here are  a couple of articles to prove it:

Texas Doesn’t Just Hold ‘Em, It Gains ‘Em

Texas Leads U.S. in Population Growth Since Recession Began

Texas is not only a great place to live but is a great place to invest in real estate.  The strong economy, affordable housing, and population growth, coupled with low levels of new home starts equal a housing shortage in 2010.

Expert: Dallas May Face Housing Shortage

Tune in to the QuadWealth Show on WBAP 820 AM this Saturday at 3pm for our in-depth analysis of the real estate market.

WOW… Record 3,000,000 homes in foreclosure…

You aren’t going to believe this-  I received the following email from a real estate attorney named Chris McLaughlin.  It is INSANE!

He says-  “RealtyTrac, the online marketer of foreclosed homes, reported that one in 45 households — or 2,824,674 properties nationwide — were in default last year. That’s 21% more than in 2008, and more than double 2007′s total.  “As bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans,” said RealtyTrac CEO James Saccacio in a prepared statement. However, by all accounts it is still uncertain whether efforts like Obama’s Home Affordable Modification Program have forestalled or just delayed foreclosure.  By early December more than 680,000 borrowers had gotten temporary workouts but only a few thousand had been permanently modified. “In the long term, a massive supply of delinquent loans continues to loom over the housing market,” said Saccacio. “And many of those delinquencies will end up in the foreclosure process in 2010.”

The four states with the most foreclosure filings — California, Florida, Arizona and Illinois — accounted for a full 50% of the nation’s properties receiving notices.  Nevada recorded the highest rate of foreclosures, at 10%, followed by Arizona, at 6.1%; Florida, 5.9%; and California, 4.75%.  But some states where foreclosure hit hard early are now faring better. Indiana foreclosures fell by 9.9%, Ohio by 10.5% and Rhode Island by 23.6%.  California, by far the most heavily populated in the union, posted the most filings with 632,573, up 20.8% from 2008. Golden State cities have also recorded some of the steepest declines in home prices, with values falling 50% or more in some Central Valley cities.”

Wow.  All I can say is WOW.  Just remember though- There are two sides of EVERY coin…  One side for those that are losing money and the other side for those that are making money.  This is a HUGE coin, with HUGE sides.  There is a LOT of money being lost by some and a LOT of money being made by others.  Think about it-

Jeremy Louder

Dallas Morning News: Tax credit fuels skyrocketing Dallas-area preowned home sales

Read the full article by Steve Brown at the Dallas Morning News.

The North Texas housing market came roaring back in November.

Pre-owned home sales rose 31 percent last month from a year ago – one of the biggest increases on record and the second consecutive month of rising sales.

Median home sale prices were up 5 percent, the largest gain in more than two years.

“This is another positive signal that the local housing market may have turned the corner,” said D’Ann Petersen, business economist with the Federal Reserve Bank of Dallas. “It is probably still too soon to declare a rebound, but two months of positive sales certainly suggest improvement.”

Throughout North Texas, real estate agents sold almost 5,500 pre-owned homes in November through the Multiple Listing Service, according to statistics released Monday by North Texas Residential Information Systems and the Real Estate Center at Texas A&M University.

The jump in residential transactions came as homebuyers rushed to take advantage of the federal homebuying tax credit, which has been extended into the spring.

Read the full article by Steve Brown at the Dallas Morning News.

Jeremy Louder