I recently had conversations with a couple of prospective home buyers who wanted to buy, but also wanted to know if housing prices were at the bottom? As I shared this conversation with my dad, he had a simple answer. He said, "you won't know until housing is at the bottom until after it starts going up. Then you'll know when you've hit the bottom."
In-state Migration
My take on it is that if we aren't at the bottom in Dallas, we're very, very close. Dallas-Fort Worth and all of the major cities in Texas including Austin, San Antonio and Houston continue to benefit from in-state migration. The u-hual indicator tells the story. It will cost you $597 to rent a 26' u-haul truck from Dallas to LA, while the charge from LA to Dallas is $2,180. It's simply based on supply and demand. Expect out-of-staters to continue to flock to Big D in droves in search of good jobs, affordable housing and no state income tax.
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Improving Dallas Economy
Also, Dallas headhunters I've talked to in the past few weeks report much better hiring activity in term positions and they expect permanent job orders to really take off in 2011. Let's hope they're right.
Pent-up Demand
Plus, there's a lot of renters out there that survived the slowdown and are well-qualified home buyers with assets and steady employment histories. This pent-up demand I think will be unleashed as soon as there are more blatant signs of economic improvement.
Rising Mortgage Rates
Finally, if mortgage rates begin to tick up as most experts are predicting in 2011, it will get some of those would-be home buyers off the fence, bringing in more home buyers, more competition and higher offers for home sellers. As prospective home buyers learn of the improving housing news, they'll then want to get in before mortgage rates and home prices rise further.
Anywho, that's my 2¢. Let's hope I'm right.
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