Is the Long Run-up in D-FW Home Prices Over?
A tiny dip in nationwide home values has analysts wondering whether the big run-up in U.S. residential values is over. Home values across the country fell for the first time in seven years in April — down 0.1% from March, according to a report from Zillow. Most of the decline was attributed to larger decreases in West Coast housing markets. Prices were down in Dallas-Fort Worth, too.
The drop in prices — while very small — adds to growing evidence of changes in the housing sector. "The widespread decline in home value growth in April — the first in many years — will turn heads," Zillow economic research director Skylar Olsen said in the report. "But it's too early to say if we've hit another national home value peak and are at the beginning of a sustained downturn or if this is just a bump in the road. "Month-over-month numbers are volatile, and this small decline could reverse itself before the year is out and before national home values go negative on a year-over-year basis," Olsen said. "That said, the likelihood that home values have peaked in several local markets is real. The price correction in these areas should continue after years of significant home value growth that substantially outpaced income growth."
Home prices in the Dallas-Fort Worth area fell 0.3% in April from March, the first such decline Zillow has reported since January 2012. Data from local real estate agents has previously shown month-to-month declines in median home sales prices that can be influenced by the types of houses trading, not just their values. Most home price surveys compare year-over-year values to reduce volatility and seasonal changes in the market. Zillow says D-FW home prices are still up more than 7% from last year — a higher appreciation estimate than most recent value studies. So far in 2019, the median sales price of single-family homes sold by agents in North Texas is up 2% from the first four months of 2018. Zillow said that in April, the "typical U.S. home is worth $226,800." That's less than the $243,900 value in the D-FW area, according to Zillow.
With more houses on the market this year in North Texas and declining sales in some neighborhoods, housing analysts are closely watching the local market, where home prices are more than 50% higher than they were before the Great Recession. The story is much the same across the U.S., where years of home price hikes appear to be easing. "Home values have likely peaked in Los Angeles, Philadelphia, Houston, Miami, Boston, San Francisco, Seattle, San Diego, St. Louis, Tampa, Baltimore, Pittsburgh, Portland and San Jose," Zillow says...