February 19,
1999
Texas Housing
Affordability -- Best Ever
COLLEGE STATION, Tex. -- Falling
interest rates at the end of 1998 boosted Texans' ability to
buy homes to the highest level ever measured.
According to Jack C. Harris, research
economist with the Real Estate Center at Texas A&M
University, the Texas Housing Affordability Index (THAI) rose
to 1.53 in the last quarter -- up from 1.46 in the previous
three months.
"From the time the THAI was first
estimated in 1989," says Harris, "the index has never been
higher."
Harris said some 2 percent more Texas
households were able to afford the median-priced home. About
67 percent of households could afford the median-priced home
at current interest rates, assuming they could make a 20
percent down payment.
In the last quarter of 1997, the THAI
was 1.47 with 64 percent of households able to afford the
median-priced Texas home.
Harris says the improvement in
affordability came despite an increase of nearly 3 percent in
median home prices. Median income increased only 2 percent.
"Mortgage interest rates fell by more
than one-half percentage point," said Harris, "making the
average monthly payment of a median-priced home actually lower
in the most recent quarter. The average interest rate on
mortgages closed in Texas during the last three months of 1998
was 6.78 percent."
"Almost 169,000 homes were sold
through the state's Multiple Listing Service last year," said
Harris. "This was the highest total recorded since the Center
began keeping housing data in 1979."
Conditions improved as well for
first-time homebuyers. The First-Time Homebuyer's
Affordability Index (FTHAI) rose to 1.26 from 1.21 last year.
The index reveals that the median income of a renting Texas
household is 26 percent high than that needed to buy the
median-priced starter home. The estimate is based on financing
requiring a 5 percent down payment.
Metropolitan areas reporting the
highest THAIs for the fourth quarter were:
-- Garland, 2.57 -- Fort Bend, 2.23 --
Paris, 2.13 -- Wichita Falls, 2.00
The overall U.S. affordability index
was 1.12.
Rural Land Market
Outlook Planned
COLLEGE
STATION, Tex. -- Anyone with an interest in rural Texas
properties should circle April 23 on the calendar. That is
when the Ninth Annual Outlook for Texas Rural Land Markets
will be held at the George Bush Presidential Conference Center
on the campus of Texas A&M University.
Presentations will cover the state of
the economy, agricultural developments and policies, rural
land buyers and sellers, legal issues and the overall rural
land market outlook. Speakers include a variety of experts
from the Real Estate Center, other university departments, the
Realtors' Land Institute and the American Society of Farm
Managers and Rural Appraisers.
Advance registration is required. The
cost is $85 per person. This includes parking and lunch.
To register for the seminar, obtain a
brochure or other information, call Margaret Benedict at
409-845-9691.
New Weed Invading
Houston
COLLEGE STATION,
Tex. -- A ground-covering plant has appeared in several
Houston lawns, and scientists at Texas A&M University warn
that -- while attractive -- the exotic species will make
itself at home and resist all efforts to kill it.
Efforts to control the trailing weed,
a South American plant called Lysianthes asarifolia, have
failed thus far. Despite multiple sprayings of maximum amounts
of several herbicides, the weed remained in the trial yard in
the Hunter Creek Village area.
"The scary thing for Houston is that
there is no control for it, and the conditions seem right for
it to flourish," says Dr. Mary Ketchersid, Texas Agricultural
Extension Service pesticide safety education program
specialist.
Pictures of the weed can be found on
the Web at http://www.csdl.tamu.edu/FLORA/imaxxsol.htm.
Some botanists in Louisiana, where the
plant once grew in a city park, have an affinity for it and do
not consider it noxious if grown in contained spaces.
Ketchersid believes that might be because Louisiana botanists
claim the plant does not fruit and flower in that state, thus
it is not as aggressive as it is in the different growing
environment of coastal Texas.
"The Texas strain is more ready to
take over whereas, in Louisiana, it has stayed in place. It's
a beautiful little plant, but given half a chance, it could
take over much of Houston," says Monique Reed, Texas A&M
botanist. "People should not give this plant to friends or
swap it in gardening clubs. That will hasten its spread."
To provide information about possible
locations of this plant in Texas or to find out how to
identify a sample, call 409-845-6531.
Homebuyers Need
To Understand Credit Scoring
WASHINGTON, DC -- The National
Association of Realtors (NAR) and Freddie Mac have joined
forces to educate homebuyers and real estate practitioners
about the use of credit scoring and automated underwriting in
the home mortgage origination process.
This information is included in
pamphlets entitled "The Doorway to Good Credit" and are being
offered to both real estate professionals and their customers
and clients. The pamphlets are free and explain the credit
scoring process while offering tips to consumers on developing
and maintaining an acceptable credit record.
Lee L. Verstandig, senior vice
president of government affairs for NAR, says people thinking
about buying a home should look at their credit record to
understand how it might affect their ability to buy a home.
"Your credit record demonstrates how
you've handled credit in the past and how you currently pay
your bills," he said. "Mortgage lenders use this information
to determine whether you'll qualify for a loan. It even can
affect the interest rate applied to the financing."
Many lenders are now using automated
underwriting and credit scoring to electronically accelerate
the loan approval process. Dwight Robinson, vice president of
industry relations for Freddie Mac, says lenders often get a
credit score as part of the credit report.
"Because a credit score and the larger
report are so important in the mortgage process, we are
pleased to work with the National Association of Realtors to
educate future homebuyers about the importance of good credit
management," says Robinson.
More than ever, good credit is
critical to consumers, says Robinson. For this reason, he says
Freddie Mac is "absolutely committed to working with Realtors
and others in the housing industry to provide good, clear
information about the prudent use of credit and how it is a
currency for future success -- whether in homeownership or
other aspects of everyday life."
Potential buyers are urged to check
their credit records and make sure they are accurate. Credit
reports are made by three private companies: Equifax
(800-685-1111), Experian (800-682-7654) and Trans Union
(800-888-4231). Because credit records can vary from one
company to another, homebuyers may wish to contact all three
to resolve potential problems in advance. There are fees for
each report, but if credit is denied, a a free copy can be
obtained.
Texas And Two
Other States Emply Most Government Workers
WASHINGTON, DC -- Texas, California and
New York -- the nations three most populous states -- led the
country in state and local government employment in 1997,
according to tabulations released today by the Commerce
Department's Census Bureau.
California, with 1.8 million on the
public payroll, topped the list, followed by Texas and New
York, each with 1.2 million. State and local governments
nationwide had 16.7 million full- and part-time employees, an
increase of less than 1 percent from 1995.
Most workers were employed in
education (nine million), hospitals (one million) and police
(856,000).
TREC To Observe
Black History Month
AUSTIN,
Tex. -- The Texas Real Estate Commission will hold its second
observance of National Black History Month on Monday, Feb. 22.
Ceremonies will be from 2-3:30 pm in room 235 of TREC
headquarters, 1101 Camino La Costa. The public is invited.
The year's speaker is Michael L.
Williams of the Texas Railroad Commission.
Demographics And
Housing
Average household
size has declined from 3.67 people in 1940 to 2.63 today and
will continue shrinking. Family size also is declining
steadily as couples have fewer children.
Household formations grew at a rate of
slightly more than one million a year in the 1960s then jumped
to 1.7 million a year in the 1970s. New household growth has
slowed since then and in the 1990s will be in the range of 1.1
to 1.2 million annually.
The composition of the U.S. population
has changed dramatically over the last three decades. The
share of young people is declining. In 1970, 58 percent of the
population was less than 35 years old; in 2000, 49 percent
will be less than 35. At the same time, the population is
aging. At the turn of the century, 13 percent of the
population will be more than 65 years old compared with 10
percent in 1970.
Traditional married-couple households
are declining in the United States and are being replaced with
non-family households. In 1970, 71 percent of all households
were married couples, and 19 percent were groups of unrelated
people living together. By 1995, married-couple households had
shrunk to 56 percent and unrelated households had grown to 30
percent of the population.
Source: National Association of Home
Builders, 1998 Housing Facts, Figures and Trends