|We're renovating Tierra Grande!||We're renovating Tierra Grande!||Bryan Pope||Pope||2019-11-13T06:00:00Z||Center News|
You spoke. We listened. In response to recent reader feedback, we’re making some changes to our flagship magazine, Tierra Grande. Starting with the January 2020 issue, you’ll notice:
The name. This is probably the first change you'll notice when your January issue arrives. Tierra Grande will now go simply by TG, a nickname we’ve used in-house for years.
More targeted content. If you’re an agent or a broker (and most of our subscribers are), the magazine will have a wider variety of articles geared toward you.
New content. Speaking of agents and brokers, we’ll roll out a new Q&A column explaining common legal issues you may encounter. You'll find it on the last page of each issue.
"You took away my 'Takeaway'?" You'll be happy to know we didn't. After receiving the October issue, one astute reader noticed our usual black boxes with a one-paragraph summary were no longer at the end of each article. Were they gone for good, she asked? No, we simply moved them to the beginning in hopes of catching more readers' eyes. Same summarization, but new location and no black box labeled "The Takeaway."
What’s not changing? The high-quality photos and design you enjoy and, most importantly, the reliable research you’ve come to expect from the Real Estate Center.
We'll be anxious to hear what you think.
|Taxes, tariffs, and Texas migration||Taxes, tariffs, and Texas migration||Josh Roberson||Roberson||2019-11-05T06:00:00Z||Demographics|
New data from the U.S. Census Bureau reveal 2018 migration patterns. As usual, top migration inflows into Texas came from either highly populated coastal states such as New York, Florida, and California or adjacent states like Oklahoma and Louisiana.
California remains the top source of Texas net migration, and last year was an exceptional year compared with prior years reported by the Census Bureau (Figure 1). In 2018, just over 86,160 moved to Texas from the Golden State. After accounting for migration outflows from Texas to California, the net migration between the two states still favors Texas by almost 50,000. Migration from Florida was a distant second with about 37,270 making the move to Texas (after adjusting for outflows, the net migration was less than 15,000).
The sudden uptick of California migrants follows the passing of the Tax Cuts and Jobs Act of 2017 (TCJA), which holds many implications for residents living in high tax states. Part of that legislation caps the deduction limits of state and local income taxes at $10,000 where formerly there was no limit.
The TCJA also reduced the mortgage interest deduction limit on new home purchases, which many real estate professionals initially believed would have a negative impact on housing activity, particularly for high-end homes. That does not appear to be the case in Texas as luxury home sales (homes priced at or above $1,000,000) expanded greatly in 2017, 2018, and so far into 2019 (Figure 2). Since the uptick in luxury home sales began months before passing TCJA, the tax reform law may instead help explain the sustained growth of high-end home sales.
While high-income homebuyers may miss out some on the mortgage interest deduction, the net effect from other aspects of the bill may have been enough to provide a net positive impact for the luxury housing market. For California buyers, the net impact may have also been enough to overcome even the capital gains bite from selling their homes back on the West Coast.
Finally, migration to Texas from outside the U.S. fell for the second consecutive year after peaking in 2016 (Figure 3). This is largely because of federal policy’s aim to curb both legal and illegal immigration since Texas follows the national trend of decreased foreign immigration.
Latin America has been in the spotlight both nationally and in Texas. Migration from Central and South America to Texas has been on the rise since the start of the decade while migration from Mexico was already in decline since at least 2013.
The newly released Census Bureau data group all foreign migration together, but previously released data are available by country. These older data reveal major immigration growth from countries such as El Salvador, Guatemala, and Honduras (Figure 4). Rapid immigration growth in prior years from this region may also explain the sudden decrease reported for 2018 in relation to immigration policy.
In addition, there has been major immigration growth up to 2017 from China, which has garnered a lot of media attention due to the exchange of tariffs between the U.S. and China. Given the increased friction between these two countries in 2018, Texas could see a decreased flow of Chinese immigrants in upcoming country-level Census Bureau data releases.
|When looking at housing data, don't jump to conclusions||When looking at housing data, don't jump to conclusions||Paige Silva||Silva||2019-11-04T06:00:00Z||Housing|
Last week, the U.S. Census Bureau released third quarter 2019 homeownership rates, and one surprising number caught my attention—the rate for San Antonio. From 3Q2018 to 3Q2019, homeownership there dropped 3.2 percentage points from 63.4 to 60.2 percent. Compare this with Texas’ homeownership rate, which increased from 62.7 to 63 percent during the same period.
San Antonio’s homeownership rate typically trends higher than the statewide average because of the metro’s older population. There are many factors that could explain the sudden drop in the homeownership rate, such as change in preference of the population from buying to renting, an influx of younger residents who can't afford to buy, uncertainty regarding future economic conditions that may hinder prospective buyers from making the leap, etc.
However, there is another possibility, one rooted in the data. Because San Antonio’s homeownership rate is relatively volatile, the margin of error this quarter was 5.9 percent with a 90 percent confidence interval. In other words, the Census Bureau estimate is expected to be within 5.9 percentage points of the real value 90 percent of the time. The 3.2 percentage point change from 3Q2018 to 3Q2019 is within the margin of error. This means that there is a chance the homeownership rate may have increased rather than decreased.
When looking at data, keep in mind the limitations before jumping to wild conclusions. That's not to say we should ignore the decrease in San Antonio’s homeownership rate, especially if the metro’s homeownership rate continues to trend downward, or that the possible reasons I mentioned have no truth here. Rather, we should explore all scenarios and explanations before settling on the worst.
|Eek! These terrifying Texas properties will give you the heebie-jeebies||Eek! These terrifying Texas properties will give you the heebie-jeebies||Rieder||2019-10-31T05:00:00Z||Mixed-Use|
Texas is known for its rich history. However, much of that history is more sinister than it seems. In honor of Halloween, we've compiled a list of some of the state's most haunted historical properties.
3. Presidio La Bahía – Goliad
Constructed in 1747, this South Texas Spanish fort is known for the part it played in the Texas Revolution—namely the Battle of Goliad and the Goliad Massacre. It became a National Historic Landmark in 1967.
But the fort's brutal history has led to rumors of several apparitions haunting the property. A woman in mourning attire is said to appear at the offering table of the fort's Our Lady of Loreto chapel, while another woman in white wanders the courtyard, searching the graves for a loved one's name.
A robed friar also patrols the chapel, which is haunted by the sounds of crying babies, a church organ, a women's choir, and randomly sounding bells.
Other spirits in the presidio include phantoms in the officers' quarters, particularly Texas Colonel James Fannin, who was killed while held prisoner by Mexican General José de Urrea. At sunset, some have seen spirits on the quad where Fannin and his men were executed. Vultures still flock to this area inexplicably.
2. The White Sanitarium – Wichita Falls
Some of the creepiest stories at least partially take place in psychiatric hospitals, like Shutter Island, "American Horror Story: Asylum," and A Clockwork Orange. But what's even scarier is this real-life horror show.
Frank S. White opened his sanitarium in Wichita Falls in 1926. His outlook on mental health was actually quite modern, as he believed his facility should be a home, not a prison. However, it has long been rumored that strange experiments were conducted there until it closed in the 1950s.
Years later, the building became a frequent haunt for teenagers, who claimed to see crazy-looking apparitions in the windows or floating, smoking ends of lit cigarettes in the halls. Visitors say they've seen ghosts playing cards or flickering lights (though that may be due to old electric wiring). Others have heard crying women and laughing children.
The Jazz Age building is now an apartment complex; those residents must be brave to sleep in such a haunted property!
1. Yorktown Memorial Hospital - Yorktown
Yorktown in DeWitt County is a charming little city with a plethora of historic sites. One of them is the Yorktown Memorial Hospital, a foreboding structure known as one of the state's most haunted buildings.
Opened by the Felician Sisters of the Roman Catholic Church in 1951, the hospital was eventually put out of business by another hospital that opened in Cuero. It later served a short two-year stint as a drug rehabilitation center until its closure in 1988.
The hospital was said to have lost over 500 patients in a six-year span and 2,000 during its 35-plus-year operation. One of the doctors was known for his fatal mistakes during operations, and some believe those errors weren't always accidents.
Apparitions in the building include a mechanic named Doug Richards and TJ, a drug addict who died on the steps of the building while seeking help. There are also rumors of a love triangle that turned deadly in the boiler room. The most violent of the spirits are the nuns, who are known to choke, scratch, or bite visitors, particularly those with tattoos.
However, not all the specters are nefarious. Stacy, a friendly little girl, can be seen and heard playing in the basement hallways. She can also be enticed to enter the library with her favorite book, The Pokey Little Puppy.
There are many more Texas ghost stories, but we'll end it there. If you're looking for more spooky stories, check out another Mixed-Use blog post, “Three haunted Texas properties that'll make your spine tingle."
What haunted Texas property is your favorite? Let us know by tweeting us @TexRec or commenting on our Facebook page. We hope you have a safe and happy Halloween!
Source: Haunted Rooms America
|So, how’s flipping going?||So, how’s flipping going?||David S. Jones||Jones, D.||2019-09-20T05:00:00Z||Housing|
Flipping houses is still good business (and good television viewing for many HGTV fans). The total dollar volume of homes flipped in the second quarter of 2019 hit $8.4 billion, a 13-year high.
Texas continues to be a flipping hotbed. Of 53 Metropolitan Statistical Areas (MSA) studied by ATTOM Data Solutions, Austin (92.6 percent), Dallas-Fort Worth (86.4 percent), and San Antonio (83.1 percent) were in the top five markets with the highest percentage of 2Q completed flips purchased with financing.
Homes flipped in 2Q 2019 represented 5.9 percent of all home sales. That was down from a post-recession high of 7.2 percent but up from 5.4 percent a year ago.
“Home flipping keeps getting less and less profitable, which is another marker that the post-recession housing boom is softening or may be coming to an end," said Todd Teta, chief product officer at ATTOM.
Homes flipped in 2Q typically generated a gross profit of $62,700, a 39.9 percent return on investment. That's down from 40.9 percent (a 44.4 percent profit margin) in the first quarter. Profits on home flips have dropped six quarters in a row and are now at the lowest point since 4Q2011. San Antonio was among the markets with the smallest gross flipping profit ($27,117) and smallest rate of return (15.6 percent ROI).
Despite the quarterly drop in home-flipping rates, 104 of 149 MSAs analyzed posted a year-over-year increase in their rates. The number of homes flipped reached new peaks in ten MSAs, including San Antonio.
Homes flipped in the second quarter sold for a median price of $220,000. Homes flipped nationwide took an average of 184 days to complete the flip. McAllen-Edinburg-Mission (150 days) was among metros with the shortest average days to flip.
“Flipping houses is still a good business to be in, and profits are healthy in most parts of the country," said Teta. “But push-and-pull forces in the housing market appear to be working less and less in investors' favor. That's leading to declining profits and a business that is nowhere as good as it was a few years ago."
|12 tips for staying safe at open houses||12 tips for staying safe at open houses||Hayley Rieder||Rieder||2019-09-04T05:00:00Z||Center News|
Showing homes and holding open houses are essential duties for many real estate professionals. While these events generally run smoothly, there is still an element of danger when inviting strangers into a client's home.
September is National Realtor Safety Month, so now is a great time to review your workplace safety practices. Although you should always be cautious while holding an open house or showing, we've compiled a dozen tips from the National Association of Realtors to take into consideration this month.
Have the seller remove all valuables from the home before the showing. An open house provides potential burglars a way to map out a home and identify valuables to target. Belongings like video game consoles, jewelry, and important documents should be removed from the property and kept somewhere safe.
Bring a colleague or friend to the open house. It is always good practice to have another set of eyes and ears to alert you to potential threats.
Check in with someone even if you are not alone at the open house. Notify someone off-property, like a colleague, friend, or relative, that you will be calling them every hour, on the hour. If you don't call, they are to call you. You should also give them the address and turn on location sharing if possible.
Create an escape plan. When you first enter a house, check all rooms to determine several escape routes. Unlock deadbolts and open a couple of windows to facilitate a faster escape. If the backyard is fenced, be sure you can escape from there as well.
Check your cell signal before the open house. Make sure your phone is charged and has an adequate signal. Program emergency numbers on speed dial.
Walk behind the prospect. Do not lead the client around the home; instead, direct them around the house from behind. The prospect should always be in your “10 and 2" range of vision.
Avoid small rooms. Stay close to the exits in attics, basements, and other small rooms. Do not let yourself be cornered.
Have a sign-in procedure to identify prospects. Have all open house visitors sign in with their full name, address, phone number, email, and vehicle information. When scheduling a one-on-one showing, be sure to photograph the prospect's identification card and send the picture to someone in your office.
Keep your keys and phone on your person. Your handbag should be locked in the trunk of your vehicle.
Keep an eye out for suspicious activity. If anything is out of the ordinary—like a man wearing a long coat on a hot day, or someone asking about when the sellers are coming home—do not be afraid to cut the showing short. However, the best course of action is to stay calm and not show fear. Confidence is key, and always keep your head up. For added protection, ask neighbors to keep an eye out for suspicious activity.
Make sure everyone is out of the home before locking up. Do not assume the home is empty after the open house. Check every room to make sure no one has stayed in the home. Make sure all windows and doors are locked.
Trust your gut. If something feels wrong, it very well may be. You should remain alert and aware. If you need to cut the open house short or alert the authorities, do not be afraid to do so. Remain professional, and get out quickly if you need to.
|Yesterday's interest rate cut could have psychological impact on homebuyers||Yesterday's interest rate cut could have psychological impact on homebuyers||Bryan Pope||Pope||2019-08-01T05:00:00Z||Economy|
Yesterday, the Federal Reserve announced that it had cut its key interest rate by a quarter-point to a range of 2 to 2.25 percent. This marked the first time the central bank had reduced its benchmark rate since December 2008.
I asked Real Estate Center Chief Economist Dr. Jim Gaines what impact this could have on the housing market. He said it will more than likely have little immediate influence.
"The long-term residential fixed interest rate is not directly tied to the Fed Funds Rate," Gaines said, "but is influenced more by the ten-year Treasury Bond rate, which in turn is more influenced by inflationary expectations.
"Core personal consumption expenditure (PCE) inflation is currently running well below 2 percent, and the financial markets appear to not expect any significant inflation in the near term."
If anything, Gaines said, the major impact of the Fed’s cut could be psychological.
"Buyers and sellers may now expect even lower rates and act accordingly," he said. "Indeed, current mortgage rates have been declining, so purchasing power of buyers is greater. There's also the demand to refinance an older, higher-interest-rate loan."
|Economic expansion sets record||Economic expansion sets record||Luis Torres||Torres||2019-07-18T05:00:00Z||Economy|
This month marks the longest expansion in U.S. economic history. According to the National Bureau of Economic Research, the expansion began in June 2009. Numbers released for July 2019 will show a record 121 months of continuous growth.
The expansion featured a downward trend in the unemployment rate that reached levels not seen since the 1960s. At the same time, an average 169,000 jobs were created monthly. The expansion was characterized by slow productivity and wage growth, and by low inflation and low interest rates. Recently, some wage growth improvements have been observed, including improvement for lower-income households.
Going forward, the economy should slow, the job market remain tight, and worker earnings rise steadily. Even with the expansion milestone, recession fears continue, fueled by growing risks from corporate debt and the leveraging of the nonbank system. Don't forget that long-run U.S. public debt is on an unsustainable path, and policy adjustments are needed to get public debt under control.
Past recessions have been triggered by financial imbalances, such as housing bubbles caused by excessive lending. Firms and markets are globally interconnected. Financial markets are dependent on low interest rates. With uncertainty on the rise over government policies, such as trade, a vehicle that is not currently apparent could bring expansion to an end.