Chalk up another milestone for the housing market recovery. According to the latest release of the S&P/Case-Shiller Home Price Index, home prices in Dallas, Texas and Denver, Colorado have returned to their pre-housing-crisis peaks. Actually, they’ve risen above those peaks.
It’s good news for homeowners in these two metropolitan areas, and a positive sign for the housing market in general. Here are the latest numbers and trends for these two cities:
Dallas Real Estate Values Rise 7.6% Annually
Like the rest of Texas, the Dallas-Forth Worth (DFW) metro area was largely insulated from the price erosion that plagued most U.S. cities during the housing bust. Dallas home prices did fall a bit in the wake of the crisis, but not nearly as much as most other major cities.
If you were to compare DFW pre- and post-crisis home price trends to, say, Phoenix or San Diego, you’d have a molehill next to a mountain. Sometimes, it’s better to be a molehill.
Home prices within the Dallas housing market rose gradually during the boom years. There was very little real estate speculation and plenty of population growth — protective qualities that applied to all major cities in Texas. So home prices didn’t have far to fall in 2007 and 2008, when the housing downturn swept across the state.
Flash forward to today. Home prices in the Dallas real estate market have risen by more than 7% over the last year or so, according to the Case-Shiller index. In May of this year, prices rose above their pre-crisis peak, which occurred in July 2007. It’s worth repeating: Dallas home prices today are higher than they were at the height of the housing boom.
Read: Dallas market benefiting from economic stability
Inventory has something to do with this. According to Realtor.com, the total number of listings has dropped by nearly 21% in the last year. This would be enough to lift prices even if demand remained static. But housing demand in the Dallas-Fort Worth area is rising, due to job growth, low mortgage rates, and rising consumer confidence. Home sales have risen to record highs in parts of the metro area, according to a recent report.
When inventory shrinks at a time of rising demand, prices go up. It’s a fundamental truth of real estate economics.
Denver Housing Market Is Booming – Just Ask a Home Buyer
In May, we published a list of hot housing markets where home buyers are facing stiff competition. Denver made the list. Data and anecdotal evidence show that the Mile High City’s real estate market has become hyper-competitive over the last year.
Once again, it’s an inventory story. While listings have increased over the last couple of months, they have fallen sharply year-over-year. Consider the evidence. According to Realtor.com’s monthly housing summary, the number of homes for sale in the Denver metro area has declined by 30% in the last year. Out of 146 cities tracked by Realtor.com, Denver had the second-highest level of inventory reduction (after Boston, MA).
Homes are selling faster, too. Both the median age of inventory and the average number of days on market (DOM) have declined in the last year. According to Realtor.com, inventory age has dropped by a whopping 47% in the last 12 months, the second-largest decline of the 146 metro areas.
Denver home prices peaked in August 2006, at the height of the housing boom. In May 2013, prices rose above their pre-crisis peak. We reported on this trend back in May. According to the Case-Shiller index, house values in the area rose nearly 10% from May 2012 to May 2013.
Disclaimer: This article contains a variety of data relating to the Dallas and Denver housing markets. Trends and statistics were provided by reputable third-party sources and verified prior to publication on our site. However, we make no guarantees about the accuracy of third-party data, or about future conditions within the housing market. This information has been provided for educational purposes and does not constitute financial advice.
Brandon Cornett is a veteran real estate market analyst, reporter, and creator of the Home Buying Institute. He has been covering the U.S. real estate market for more than 15 years. About the author