The key to maintaining real estate prices is avoiding foreclosures. Once foreclosures hit a neighborhood, the supply of homes for sale increases, the price decreases, and everyone gets very unhappy.
So far, we have avoided the foreclosures that are swamping much of the rest of the country, as well as parts of Dallas County. Most of the foreclosures have been in outlying parts of the county, where there was enough vacant land to throw up subdivisions. Subdivisions, for several reasons, attract foreclosures the way mobile homes attract tornadoes.
In this respect, it’s not news that foreclosures in Dallas County are up 40 percent from a year ago. In counties with even more subdivisions, like Denton and Rockwall, the figure is 50 percent.
What is news is that the foreclosures seem to be moving into Dallas proper, and even creeping inside of the LBJ. There is anecdotal evidence here that foreclosures are increasing in Preston Hollow, and I have talked to several real estate types who say they are seeing more foreclosures in the M Streets and even the Park Cities.
So far, though, the evidence is mostly anecdotal. Foreclosures, for several reasons, aren’t tracked as thoroughly as other home sale data like prices and time on market. So that RealtyTrac reports that there are 822 homes currently in some sort of foreclosure proceeding in 75214 doesn’t mean much without perspective, and perspective requires month-by-month stats that aren’t readily available.
I’ll follow up on this and should have something next week that will offer some perspective.
