Home Construction In Dallas-Fort Worth Rises For First Time In 3 Years

The Dallas News

 

Home construction in the Dallas-Fort Worth area rose for the first time in more than three years during the fourth quarter.

The almost 10 percent gain in home starts came as the inventory of new houses on the market fell to low levels, housing analyst Residential Strategies Inc. said Thursday.

The increase in the final three months of 2009 "marks the first uptick in the annual start rate since second quarter 2006," Residential Strategies' Ted Wilson said. "This is a significant event signaling that the housing market is in the bottoming process."

Builders started 3,615 homes in the fourth quarter, up from 3,200 in the same period of 2008.

The biggest increase in starts was for homes priced between $150,000 and $200,000, Wilson said.

"Some of the larger builders are flexing their muscles and trying to pick up market share," he said. "The strategy appears to be to have some speculative homes ready for buyers to move into this spring."

For all of 2009, home starts in the D-FW area totaled 13,499 units – the lowest construction volume since 1991.

But while home construction is picking up, sales of new homes lagged in the final quarter of 2009.

Builders closed 4,710 home sales, down about 15 percent from fourth quarter 2008. Still, sales in the just-completed quarter were the strongest in all of 2009.

"The fourth quarter typically is a slower period for new home sales," Wilson said.

The increase in homebuilding in the D-FW area comes after more than two years of annual declines.

"Home starts were generally up fourth quarter nationally, but the level is still way below where it was several years ago," said James Gaines, an economist with the Real Estate Center at Texas A&M University.

Builders in North Texas have fewer homes and Texas apartments left to peddle than their counterparts in other parts of the country. There is almost an eight-month supply nationally.

"Overall, the supply of housing inventory is in excellent shape," Wilson said of the D-FW area. "Total new home inventory is at a 6.5-month supply."

A six- to 6.5-month supply of new homes is considered market equilibrium, he said.

At the end of December, there were fewer than 2,700 new vacant homes on the market in the D-FW area.

Wilson said the new home market won't have a real turnaround until the underlying economy rebounds.

"Consumers need jobs if they are going to feel confident about making new home purchase or home remodeling decisions," he said.

Some Major Real Estate Assets Have Worked Out Of Distress

Houston Chronicle

Houston's commercial real estate market is ranked ninth among 57 U.S. markets in distress, according to Real Capital Analytics.

In its latest report, the New York research firm said this area had 211 properties in default, bankruptcy or foreclosure as of Dec. 1.

The value of the buildings, which spanned all property types, was $4.8 billion.

Las Vegas ranked at the top of the list of markets in distress as a percentage of total property investment volume.

While the number of troubled properties in Houston has been growing, some of the larger assets have worked their way out of distress and have new owners.

Last week, an investment group purchased the 44 units that were put into bankruptcy at the Endeavour condominium tower on Clear Lake.

Last month, the owner of Greenway Plaza gave the keys back to its lender, Barclays Capital. The investment bank formed a joint venture real estate firm to own and operate the project.

And the Mosaic high-rise near the Texas Medical Center recently was acquired out of foreclosure by a group led by Starwood Capital Group.

Real Capital broke down the distress in Houston by property type.

The office sector had the highest amount of capital at risk with $2.4 billion in distress in 19 properties.

The Houston apartments and retail sectors each had more than $1 billion worth of properties on shaky financial ground.

Regionally, Houston had the highest volume of distress among the top Texas markets, but Dallas wasn't far behind with $4.5 billion.

Nationally, the volume of troubled properties totaled $161 billion.

Retail remains the hardest-hit property sector with $37.5 billion in distressed situations, with hotels second at $32 billion.

Small-scale remodeling

Home improvements that pay off don't have to be major investments.

Small-scale exterior home remodeling jobs can be the most profitable when selling a house, according to a survey of real estate agents.

Door and siding replacements, as well as wood outdoor deck additions that cost less than $14,000 were some of the top projects in terms of costs recouped in the 2009 Remodeling Cost vs. Value Report.

A steel entry door replacement returned nearly 130 percent of costs, followed by upscale fiber-cement siding replacements at 84 percent. Wood deck additions returned 81 percent of costs.

The study, produced by Hanley Wood and Realtor Magazine, compares construction costs with resale values for 33 midrange and upscale remodeling projects, including home addition, remodels and replacements in 80 markets.

Attic bedroom additions moved up in terms of profitability in this year's study.

They recouped 83 percent of home remodeling costs compared with 74 percent in 2008, the report says.

The least profitable jobs were home office redos and sunroom additions.
Market Square Park

City boosters hope the renovation of Market Square Park will spur property owners in the northern end of downtown to develop their empty parcels.

“With the renovation of Market Square Park, we will further our goal of helping create a true urban neighborhood in the north end of downtown and encourage property owners in the area to develop their properties, many of which are large tracts of parking lots and Houston apartments,” said Jaime Mize, board chair of the Downtown Houston Redevelopment Authority.

It certainly happened to a few of the lots around Discovery Green, the 12-acre park on the eastern edge of downtown.

A high-end office building and hotel are going up adjacent to the park, and a residential tower was recently completed.

Construction on Market Square Park is expected to begin by year-end, with its completion scheduled for the middle of 2010.

Lauren Griffith Associates, a local landscape architecture firm that was involved in Discovery Green, is designing the park. Ray + Hollington Architects and Tribble & Stephens Constructors are also involved.

A central lawn will anchor the park, which will include a dog run, performance area and a cafe. The Downtown District is in negotiations with Niko Niko's Greek & American Cafe to operate an eatery there.

Older artwork like James Surls' Points of View sculpture will be moved or updated and newer installations will be added.

The park will also include a memorial to honor the victims of 9/11, including Houstonian Lauren Catuzzi Grandcolas.