Dallas Homes Still Affordable

Study: Dallas homes are more affordable this year 11:45 AM CT

12:16 PM CDT on Thursday, May 7, 2009
By STEVE BROWN / The Dallas Morning News
stevebrown@dallasnews.com

Falling home prices and lower interest rates have made homeownership more affordable for Dallas residents,

The Dallas area is 110th in a ranking of the country ‘s most expensive U.S. housing markets in 2008, according to the Center for Housing Policy in a study released Thursday.

That’s a slight improvement from 2007, when Dallas placed 106th.

The median home price in 2008 was $155,000, compared to $183,000 the year before, according to the Center for Housing Policy report.

That meant an average homebuyer in the Dallas area needed 16 percent less income last year to qualify to buy a midprice home, the study found.

Researchers compared median housing costs in more than 200 U.S. metropolitan areas with average wages earned to come up with the ranking.

While nationwide home prices have fallen more than 20 percent, residents in many high-price markets still can't afford to buy homes, the study concludes.

“Contrary to popular belief, the recent decline in home prices has not resolved the nation’s housing affordability problems,” Jeffrey Lubell, executive director of the Center for Housing Policy, said in the report. “Working families – including most of the workers who will be hired as a result of federal spending in the stimulus package – still cannot afford to buy a home in most markets, and many also struggle to afford their rents.”

The D-FW area ranked as the 71st most expensive home rental market in the study, with an average rent of $905 for a two-bedroom apartment.

While Texas cities typically fare better in such reports, many of the state’s residents still can't find affordable housing to rent or buy, said Keith Wardrip, senior research associate for the Center for Housing Policy.

“The prices haven’t dipped enough even in Dallas for a lot of full-time employees to be able to afford a home,” Wardrip said. “Even with the lower prices, it hasn’t brought home ownership or rental housing within the reach of many.”

And lower mortgage rates and prices are enough for some potential buyers, he said.

“The prices are lower, but the lending standards are tighter,” Wardrip said.

San Francisco was the most costly market for the second year in a row, even though median home prices fell almost $200,000.

New York, which saw a $70,000 dip in median prices, placed second.

The most expensive Texas market on the list was Austin, which ranked 83rd with a median price of $176,000.

The most expensive U.S. apartment market was San Francisco with an average rent of $1,658 for a two-bedroom unit.

Most expensive homebuying markets
List was based on a comparison of median home prices in each metro area in 2008. Income needed is the percentage change in qualifying income required to buy in 2008 from 2007:
City Price Income needed
1. San Francisco $575,000 -26%
2. New York $455,000 -14.2%
3. San Jose $410,000 -37.4%
4. Honolulu $400,000 -3.1%
5. Santa Cruz, Calif. $400,000 -37.1%
Texas cities
Austin $176,000 -15%
Dallas $155,000 -16.1%
Fort Worth $131,000 -15.2%
Houston $150,000 14.1%
San Antonio $146,000 -10.8%
SOURCE: Center for Housing Policy