Real Estate

Fed Balance Sheet Unwind Proceeding At Snails Pace

The balance sheet unwind for the Federal Reserve is proceeding at a snails pace. After a rather large jump in the securities holdings last week, we should have seen a resumption in the balance sheet shrinkage. Interestingly the Fed's holdings of Treasury and mortgage securities only fell by $4.8 billion this past week. A look at the weekly System Open Market Account Holdings shows there is a lot of work to do in the last week of the year if the Fed is going to stick to it's stated unwind schedule. While the Fed has [...]

Denton County Home Prices Closing Year On High Note

Denton County home prices and sales volume have remained strong into the holiday season. After experiencing a soft patch in September home sales in Denton County resumed their march higher. It would appear that home prices in the Denton area are poised to hit new highs at the end of the year if momentum continues. Median home prices in Denton were about 3 percent higher through November, while median prices in Denton County jumped 11 percent compared to a year ago. Average prices in Denton County also reflect a 10 percent increase through November. Denton [...]

Mortgage Interest Deduction In Play, 2018 Housing Market Still Cloudy

The controversial mortgage interest deduction is still in play if you follow the back and forth in DC, and the picture for housing is still rather cloudy. There is a lot which could change depending on what Congress tries to ram through reconciliation in terms of the House and Senate tax sausage. Regardless of what Congress and the GOP approve, you can rest assured it won't stimulate job growth and it won't contribute to long-term economic growth. What we are seeing play out in the halls of DC and Wall Street right now is a [...]

Flattening Yield Curve & Spiraling Debt – What Could Possibly Go Wrong?

All is well in the land of rainbows and unicorns. At least that's the message being floated from DC and their Wall Street handlers. Apparently the economic "recovery" has been so robust that Janet and company at the FOMC have even starting to unwind that massive hedge fund, even if they are doing so at a snails pace. As Professor Anthony Sanders noted, at the current pace of normalization the Fed will manage to unwind the mess they have created in a mere 7 years. Despite all of the rhetoric about tax cuts and economic [...]

New Home Sales Jump In October, Average Prices Hit New High

New home sales continued to enjoy a hurricane-related boost in October. The Census Bureau reported new single-family home sales at a seasonally adjusted annual rate of 685,000, up 6.2 percent from revised September numbers and 18.7 percent higher than a year ago. The median price of a new home in October was $312,800 while the average price of a new home was $400,200. The talking heads will no doubt see this as a boon for the housing industry, and the numbers are certainly encouraging. That being said, I wouldn't read too much into the volatile [...]

Average New Home Size Continues To Shrink

The National Association of Home Builders reported that the median and average size of a new home in the U.S. continued to decline in the third quarter. Third quarter numbers on housing starts show that the median single-family new home size was 2,378 square feet.  The average square footage for new single-family homes declined to 2,518 square feet. According to the NAHB, this is apparently just part of the normal housing cycle. "The post-recession increase in single-family home size is consistent with the historical pattern coming out of recessions. Typical new home size falls prior to and during a [...]

QE Or Bust – US Yield Curve Continues To Flatten

Behold the flattening U.S. yield curve! Reading through the latest Quarterly Report on Household Debt and Credit, you might get the impression that things are still humming along just fine. After all total household debt just hit a new high in the latest survey posting at $12.96 trillion. Mortgage debt is still below the previous bubble peak, so home buyers would appear to be doing doing just fine. If you peak below the headline metrics, however, you begin to see some cracks in the "everything is awesome" narrative. One of the first things that stands [...]

3000 New Homes Coming To Pecan Square Northlake TX

Hillwood Communities has purchased 1157 acres for a new master-planned community to be named Pecan Square. Pecan Square will be a new development in Northlake Texas, west of I-35 along FM 407. Pecan Square will feature new homes from Ashton Woods, CalAtlantic (aka Lennar post-merger), D.R. Horton, David Weekley, Highland, Perry, Plantation and Pulte. Hillwood Communities expects to break ground on Pecan Square in the spring of 2018 with new homes arriving to the market in the summer of 2019. New home prices in Pecan Square are slated to start in the mid $200's. Pecan [...]

More Denton County Homes For Sale As QE Unwind Begins

As the Federal Reserve begins their QE unwind, one interesting metric to watch will be the number of Denton County homes for sale. The number of Denton TX homes for sale was up 34 percent year-over-year in October. In Denton County inventory was roughly 18 percent higher through October. In Collin County the number of homes for sale was up a surprising 38 percent compared to last year. Reading between the lines, it appears the Goldilocks economy that the DFW area has enjoyed for the past 5 years is due for some consolidation. The inventory [...]

DFW Home Prices Pushing Limits Of Affordability

DFW home prices have been on a tear during the last 5 years. That begs the question of whether the recent price gains are sustainable. The answer to that inquiry generally boils down to who is selling what. In our hyper-financialized housing market it is not surprising when real estate practitioners or lenders suggest that we are not in a housing bubble. Whether you call it a housing bubble or not, there is no denying that the past decade has seen some dramatic shifts in the real estate market. Dallas/Fort Worth is certainly part of [...]

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