Jun 10, 2016
Capital market pullback, bite out of Dallas-area real estate boom
DALLAS-FORT WORTH - Along with new jobs and population growth, you need a lot of moolah to pay for construction and investment—billions and billions of dollars in North Texas.So word of...
DALLAS-FORT WORTH - Along with new jobs and population growth, you need a lot of moolah to pay for construction and investment—billions and billions of dollars in North Texas.
So word of a slowdown in property market funding isn’t what industry members want to hear and could affect the number of construction cranes rising on Dallas’ skyline.
“What we are seeing right now is a slowdown in the capital markets,” said James Lee, chairman of the Counselors of Real Estate, an 1,100-member organization of real estate advisers and executives from around the county. “Capital markets are pulling back right now.”
Lee said new rules governing commercial mortgage-backed securities, which kick in this summer, will affect the dollars available for commercial real estate.
He cited tightening federal regulations and lending requirements with the banks will reduce real estate lending.
“The positive side is it will put a damper on overconstruction,” he said.
Indeed, if the flow of funds to new real estate projects is more metered—slowed down, not totally withdrawn—look for a cool-down in the crazy pace of construction and property purchased in the Dallas-Fort Worth area.
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