Of all the heartbreaking stories we heard about during the market collapse of 2008 – 2010, Texas was surprisingly absent. The state with the largest landmass on the continent, and the second largest population-wise was left off from the list of casualties of the housing market. Notably, the states of Nevada, Florida, Arizona were among the most prominent victims, and as time proceeded and the state’s crushing debt was revealed, California. Yet Texas seemed to be floating in a perma-bubble, ever protected from the rest of the country’s housing woes.
But, as detailed in the Dallasnews.com article, Texas’ largest metroplex, the Dallas/Ft. Worth area, is starting to experience a deflation in their real estate markets.
Although it’s not a catastrophic collapse, home prices over the past several months beginning in late summer up through November have shown a steady decline. Experts say that this is due in part to the expiration of the government tax incentives that boosted sales through June as well as a rising inventory of houses on the market due to mortgage defaults, foreclosures, and other unforeseen property distresses.
Before July 2010, Dallas home prices were showing eight straight months of incremental increases. The decline was largely sparked by the expiration of tax cuts, which were helping to keep other factors such as a rising inventory at bay. But without the tax cuts for a buffer, people stopped buying as many houses, forcing sellers to compete with fewer buyers. This in turn has caused the pricing index to fall.
As far as an outlook, experts are citing the faltering economy as the main factor in keeping housing prices and market activity depressed. Until people can feel comfortable in their investments and have acquired enough capital to make such investments, buyers will remain tenuous. Maybe those bush-era tax cuts will spur the top 2% incomes to go out there and help struggling sellers.
Coming up this week: 10 Things About Agents #’s 4-6