I know this blog is supposed to be about architecture, but seeing as I passed the brokerage exam (still waiting, two weeks later, on my paperwork) I do pay attention to housing – just because I have learned a lot in the transactions I have been a part of.
In the Dallas area, we have been blessed with a housing market which has not been hit nearly as bad as other areas. We have had our share of builders with excessive inventories and neighborhoods which have had concentrated pockets of problems, but on the average the Dallas market has done relatively well. From the graphic below from the Real Estate Center at Texas A&M University (using data from MetroTex, which is Dallas’ local chapter of Realtors) one can see that we saw a substantial drop in average price in 2009 which was quickly recovered in 2010.
Volume, showed in blue, is significantly lower, which is most likely a result in the lack of confidence – people less likely to build a new house, trade up, or whatever the case may be. This has been a lesson in economics – prices will not ALWAYS go up. The long term trend, however, from 1979 shows growth, but like any other investment vehicle, homes are not steady. My own thoughts are that home prices will remain relatively flat for quite a while.
This graphic shows price distribution – we you can see numbers from 2000 in blue and 2010 in red. Interesting phenomenon here is a substantial shift from the 100-120K range to the higher end range, showing more expensive homes have not been apparently as hard hit (and therefore are still conveying ownership) as the median price range.
I’m going to hope that this has been adjusted for 10 years of inflation. It does not say so on the graphic, but usually these guys are pretty smart. Just from a simple inflation calculator that I use regularly (this uses the CPI), $100,000 in 2000 would be valued at $123,357 in 2009, which is a pretty good jump. Real estate rolls a little differently due to markets and liquidity, but the power of a dollar should still be a factor in this comparison.