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RECON for March 23, 2021RECON for March 23, 20212021-03-23T05:00:00Z2021-03-23T05:00:00Z
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Beginning this month, the Monthly Review of the Texas Economy will be replaced by our new Texas Employment Report. This report will contain the same Texas Workforce Commission data you've come to expect, but it will also include analysis by Texas Real Estate Research Center experts. Click here to read the January 2021 report. Subscribe to email notifications so you always know when this report is published. (Graphic by Center Creative Manager Bob Beals.)
March 23, 2021

Texas existing-home sales drop 16 percent in February as inventory falls to less than 1.5 months

COLLEGE STATION (Texas Real Estate Research Center) – Texas’ housing market slowed in February after persistently low mortgage interest rates contributed to record sales in the existing-home sector the previous month. 

"Sales activity was greatly hindered by February’s unseasonably wintery weather that caused power outages and water disruptions across the state," said Dr. Luis Torres, research economist for the Texas Real Estate Research Center at Texas A&M University. 

Existing-homes sold through the Texas Multiple Listing Services declined 16 percent from January, drawing even with year-ago levels. Despite slower sales, the state’s existing-home inventory fell below 1.5 months in February. The number of new listings that hit the market declined for the second straight month to their lowest reading since April 2020, when the state was under a stay-at-home mandate. 

"New listings rebounded during the summer amid strong housing demand, but they have trended down since fourth quarter 2020, contributing to the lack of homes for sale," Torres said. "Supply is expected to remain tight in 2021, affecting home sales."

Many analysts point to older homeowners holding onto their houses longer, resulting in a reduced supply of active listings available to the increasing number of millennials becoming first-time homebuyers. 

According to the National Association of Realtors, first-time homebuyers accounted for 31 percent of February sales, which overall decreased 4.5 percent relative to January. Compared with year-ago levels, however, activity elevated 8.2 percent. The share of homes sold to first-time buyers was even higher in the new-home market. The February National Association of Home Builders/Wells Fargo Housing Market Index survey indicated 43 percent of new single-family homes sold were to first-time buyers in the last 12 months.  

Foreclosure moratoriums are causing fewer homes to be put on the market than otherwise would be expected at the elevated levels of joblessness experienced in the past year.     

"During times of economic hardship, foreclosures typically increase, providing additional listings for sale," said Torres. "However, forbearance and the federal foreclosure moratorium have provided help to households during the pandemic. Continued stability in the housing market is essential to Texas’ economic recovery."

The Federal Housing Finance Agency has extended the foreclosure and REO eviction moratoriums for properties owned by Fannie Mae and Freddie Mac through June 30, 2021. Eligible borrowers were also granted an additional three-month extension of forbearance for a total of up to 18 months. The Centers for Disease Control and Prevention’s federal eviction moratorium is set to expire at the end of March.   

Rising mortgage rates are another headwind to the Texas home market. The Federal Home Loan Mortgage Corporation’s 30-year fixed-rate ticked up for the second straight month in February to 2.8 percent. Continued increases may soften housing demand.  

"The 30-year mortgage rate is closely linked to the ten-year U.S. Treasury bond yield, which looks to increase in the coming months as vaccination rates improve, and the third fiscal stimulus package supports economic recovery," Torres said.

In Texas, Gov. Greg Abbot lifted the mask mandate and increased capacity of all businesses and facilities in the state to 100 percent starting March 10.

"Prospects for Texas’ full economic recovery continue to depend on dwindling COVID-19 cases and hospitalizations and progress on the vaccine front," Torres said, "but optimistic consumer behavior could boost business activity, reduce the number of layoffs going forward, and allow Texans to return to the labor force."

Read more about the Texas Real Estate Research Center's predictions of economic activity of COVID-19.
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Texas initial claims rise unexpectedly, trend still points downward

COLLEGE STATION (Texas Real Estate Research Center) – Initial jobless claims in Texas increased unexpectedly to 71,500 the week ending March 13. Despite the increase, claims continue to trend downward. 

Texas' increase accounted for 48 percent of last week's national rise in jobless claims. 

​About 4.6 million unemployment claims have been filed since​ March 21, 2020, according to U.S. Department​ of Labor (DOL) data. 

Continuing unemployment claims increased to​ 360,100 the week ending March 6.

The number of workers receiving benefits through the pandemic unemployment assistance program, which is open to gig workers and others who don’t typically receive benefits, increased considerably the week ending March 13.​

​Last week, U.S. initial claims increased to 770,300, bringing the 52-week total to 81.9 million. 

Fewer people in all of Texas' major and border metros filed new unemployment claims the week ending March 6.

Using data from the DOL and the Employment ​and Training Administration, the Center has estimate​d unemployment claims for Texas' major and border metros since March 21:
  • Houston-The Woodlands-Sugar Land, 1.06 million claims;
  • ​​Dallas-Fort Worth-Arlington, 1.01 million claims;
  • San Antonio-New Braunfels, 311,800 claims;
  • Austin-Round Rock, 261,800 claims;
  • McAllen-Edinburg-Mission, 128,000​ claims;
  • El Paso, 109,300 claims;
  • Brownsville-Harlingen, 56,300 claims; and
  • ​​Laredo, 31,900​ claims.​​
Increasing vaccination rates should lead to a faster recovery in the leisure and hospitality sector, possibly creating a wave of hiring that would allow thousands of laid-off workers to find jobs.

Healthcare and social assistance registered the highest number of initial claims the week ending March 6. That sector was followed by administrative/support/waste management/remediation services, retail trade, ​construction, manufacturing, and ​accommodation and food services.
Sketchy drawing of commercial buildingsThe Texas Real Estate Research Center's Texas Quarterly Commercial Report looks at past, present, and future commercial real estate activity in the state's four major metropolitan areas. It covers the office, retail, and warehouse sectors. Read and download the report for free, and subscribe to know when the next issue is published. 

Tax Day extended to May 17, June 15 for winter storm victims

​​WASHINGTON (Internal Revenue Service) – ​The Treasury Department and Internal Revenue Service (IRS) have extended the federal income tax filing due date for individuals for the 2020 tax year from April 15, 2021, to May 17, 2021.

​Earlier this year, the IRS announced relief for victims of the February winter storms in Texas, Oklahoma, and Louisiana. Affected individuals in these states have until June 15, 2021, to file various individual and business tax returns and make tax payments. This extension to May 17 does not affect the June deadline.​

Individual taxpayers can also postpone federal income tax payments for the 2020 tax year until May 17, 2021, without penalties and interest, regardless of the amount owed. This postponement applies to individual taxpayers, including those who pay self-employment tax. Penalties, interest, and additions to tax will begin to accrue on any remaining unpaid balances as of May 17.

Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until Oct. 15 by filing Form 4868 through their tax professional or tax software or using the Free File link on IRS.gov. This does not grant an extension of time to pay taxes due. 

​This relief does not apply to estimated tax payments that are due April 15, 2021. These payments are still due April 15. 

The federal tax filing deadline postponement does not apply to state tax payments or deposits or payments of any other type of federal tax. 
NewsTalk Texas logoHungry for more Texas real estate news? Then feast your eyes on NewsTalk Texas, our online news database. Here are a few of the stories you'll find there this week: NewsTalk Texas is updated each weekday, throughout the day. 

Chicago developer building 1M-sf warehouse in Denton

​​DENTON (Dallas Business Journal) – Logistics Property Co. has submitted plans for 114 Logistics Park west of the Texas Motor Speedway along SH 114. 

Phase one will include a $32.5 million, one million-sf speculative warehouse.

Designed by Ware Malcomb, the project breaks ground in fall 2021.
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Work starts on San Antonio rental community

​​SAN ANTONIO (REBusiness Online) – ​California-based AHV Communities has begun work on Farm Haus, a 142-unit single-family rental community.

Residences will have two-, three- and four-bedroom layouts. Monthly rents will range from $1,775 to $2,200. 

Amenities will include a pool, fitness center, communal kitchen, conference room, great room, bocce court, and dog park.

Construction will be carried out in five phases, with preleasing beginning in April. Full completion is slated for second quarter 2022. 
Communication Matters video seriesThe Texas Real Estate Research Center's Texas Home Price Index measures price appreciation changes for residential single-family homes. It provides data for eight different Texas metros across three different price ranges.

Universal Technical Institute planning North Austin campus

​​​​​AUSTIN (Austin Business Journal) – ​Universal Technical Institute Inc. has leased 100,000 sf for a campus offering automotive, diesel, and welding technology courses. 

The campus will open in CM Tec​hridge in early 2022. 

HPI Real Estate Services and Investments handles leasing for the space. 

Florida investor acquires two DFW apartment communities

​DALLAS-FORT WORTH (Dallas Morning News) – Miami-based Eagle Property Capital has acquired two Dalla​s-area rental communities.

The 320-unit Residences at Northgate is at 4310 W. Northgate Dr. in Irving. 

Arbor Creek is a 280-unit apartment property at 396 E. Southwest Pkwy. in Lewisville.

Both properties were built in the mid-1980s.

The purchases were financed with $55.1 million in loans arranged by Berkadia and Freddie Mac.
Looking for reliable rural land data for Mississippi, Louisiana, Alabama, and Texas? We've got you covered. Get the data exclusively from the Texas Real Estate Research Center.
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Material herein is published according to the fair-use doctrine of U.S. copyright laws related to non-profit, educational institutions. Items attributed to sources other than the Texas Real Estate Research Center at Texas A&M University should not be reprinted without permission of the original source. To send news items for consideration, e-mail Hayley Rieder. The Texas Real Estate Research Center is part of Mays Business School at Texas A&M University in College Station - the heart of the Research Valley.

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