Get Ready Texas! The affluent households of New York and California are coming your way!
What damage will the loss of a deduction do to blue states with stiff taxes? Do you live in a sinkhole state? There are eight of them, led by California and New York. These are places where the population dependent on the state — for employment, welfare or a pension — is larger than the population feeding it. That excess of takers over makers is recipe enough for trouble when the next recession hits. But now some of the sinkholes have a new worry.
The Trump tax law enacted in December just about killed the federal deduction that prosperous people take for state income taxes. In states with stiff taxes, the cost of living has suddenly gone up. Now high-income folks who pay the bills for big government in California, Illinois and New York will be even more motivated to decamp for Florida and Texas. If they leave, a dwindling group of productive workers will be left to shoulder a rising financial burden. Get ready Texas, here they come!
Dallas is the best place in North America for Amazon's new headquarters, according to a Wall Street Journal analysis released Friday that cites North Texas' large tech workforce as the main draw. Dallas beat out the other 20 metro areas that Seattle-based Amazon announced last week as finalists for its second headquarters, the Journal reported. "A large tech labor force, and middle-of-the-road ranks for nearly everything else, places Dallas at the top of our ranking," the publication said. The Journal based its criteria on what Amazon has said it wants, including a metro area with more than a million people, a stable and business-friendly environment and a location where it can attract and keep tech talent. The prize is a $5 billion facility that will provide 50,000 jobs paying six figures and up — plus billions of dollars in additional investment in the surrounding community over the next 10 to 15 years.
- Dallas Business Journal, January 26, 2018
Homebuyers competing for a property in North Texas are going the extra mile to make a deal. Last year, almost 40 percent of the Dallas-area homes that sold went for more than the asking price, according to new data from real estate portal Zillow. Nationwide, about 1 in 4 homes sold for more than the original list price. "Low interest rates and strong labor markets with high-paying jobs have allowed homebuyers in some of the country's priciest housing markets to bid well over asking price," Zillow senior economist Aaron Terrazas said in a new report. "We don't expect this inventory crunch to ease meaningfully in 2018, meaning buyers will be facing many of the same struggles this year." To be sure, the relatively high proportion of houses being sold over list price is not new for the D-FW area, with too many buyers chasing too few houses. In the past three years, the proportion of houses sold over list price has held steady at about 39 percent.
In North Texas, only a two-month supply of homes was listed for sale in December — a third of what is considered a "balanced" market. D-FW home prices are currently at record levels and have risen by more than 40 percent in the last four years. In 2017, it just took about 40 days on average to sell a preowned North Texas single-family house listed for sale with a real estate agent.
Dallas-Fort Worth's job base grew the fastest of the nation's dozen biggest metro areas over the year, the Bureau of Labor Statistics reported Thursday. From November 2016 to November of last year, the D-FW metro added 100,400 jobs — a 2.8 percent increase. That was also the largest increase by sheer number.
Much of D-FW's growth was spurred by expansion in professional and business services, which added 31,100 positions. That's no surprise as regional leaders work to recruit corporate headquarters that employ thousands of highly paid workers in sprawling new developments anchored by offices. In particular, financial services companies have expanded their head counts in areas where living costs are cheaper than the coastal cities where those companies often have their headquarters. Charles Schwab, for instance, is expected to have 2,600 workers at its campus in Westlake that's under construction.
Now, economists say, the biggest challenge in many fast-growing cities is to find enough workers to fill those jobs as baby boomers age out of the workforce and immigration slows. At the national and state levels, unemployment has been at record lows. Still, the Federal Reserve Bank of Dallas predicted that Texas, whose growth has has been powered in large part by D-FW in recent years, will continue to add jobs at top speed in 2018.
Tierra Grande Magazine has published the complete breakdown of In-Migration into Texas during the calendar year 2015. The article shows the following states were the top 10 providing the most In-Migration into Texas during that year:
Dallas-area home prices were up by 6.4 percent in November. That's slightly less than the nationwide year-over-year median home price increase, according to researchers at CoreLogic. Nationwide, prices were 7 percent higher from November 2016 levels.
Dallas-area home prices are at record levels but are rising at a slower rate than in recent years. Through the first 11 months of 2017, median sales prices for preowned single-family homes were 9 percent higher in North Texas than in the same period of 2016, according to the latest data from local real estate agents. North Texas home prices have risen 60 percent since 2009 during the recession.
Homebuilders rushed to increase construction the fourth quarter, growing the number of single-family home starts by more than 20 percent from the same period in 2016. The jump Dallas-Fort Worth homebuilding in the final months of the year pushed total North Texas single-family starts to 33,891 homes for 2017 - the strongest building volume in a decade, according to data from Residential Strategies. "It's evident builders are revving up," said Ted Wilson, principal for the Dallas-based housing analyst.
With more construction, the number of houses builders have in inventory has grown. At the end of 2017, there were about 5,750 unfinished vacant new houses in D-FW - a 2.2-month supply. A year earlier there were only about 4,400 new homes in inventory. Wilson said builders are starting more speculative houses to meet buyer demand. "We are getting more finished inventory on the ground which is great for the relocation buyers," he said.
A record number of North Texas homes changed hands in 2017. More than 106,000 preowned single-family homes were sold in the area by real estate agents. That's 5 percent more than the all-time high sales in 2016. North Texas home sales have risen more than 60 percent since 2010. "I believe the resale market has more room to grow-both in sales and demand in 2018," said Paige Shipp with housing analyst Metrostudy. "However, as the median price increases, appreciation and sales pace will slow."
At the end of December, 17,440 preowned houses were listed for sale with real estate agents in the more than two dozen North Texas counties included in the numbers - 6 percent more than a year earlier. December listings work out to only a 2-month supply of homes in inventory for sale. That's still less than half of what's considered a normal market.
Sales of houses priced at less than $180,000 declined in 2017 because of the low number of these properties on the market.