The November 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
Total Texas housing sales increased for the second consecutive month, rising 5.1 percent to exceed 38,600 seasonally adjusted transactions. Historically low mortgage interest rates contributed to robust demand, pulling the state’s average days on market to a record low of 48 days. Building permits and housing starts suggested construction activity will pick up in the coming months, but current inventory is extremely depleted, and bank loan data indicated residential investment slowed during the third quarter. With homes flying off the shelf at the present rate, the housing supply would last just 2.1 months if no additional listings entered the market. Constrained inventory contributed to double-digit growth in the median home price as the composition of sales shifted toward higher-priced houses. The Real Estate Center’s Repeat Sales Home Price Index also accelerated, albeit at a more moderate pace, threatening recent improvements in affordability. The pandemic and the associated economic uncertainty remain the greatest headwinds to the Texas housing market, and survey data indicated the proportion of Texas mortgagees at risk of foreclosure in the coming months increased relative to the prior month. Moreover, the Real Estate Center projects a step back in single-family sales during November.
Supply1
The Texas Residential Construction Cycle (Coincident) Index, which measures current construction levels, flattened as industry wages and construction values moderated, offsetting a modest uptick in employment. The Residential Construction Leading Index rose for the sixth straight month amid increased housing starts and a decrease in the real ten-year Treasury bill, although multifamily building permits stumbled. At the metropolitan level, the leading indexes also trended upward.
Recently released third-quarter private bank loan data revealed a slowdown from last year’s rapid clip as lending standards continued to tighten during the pandemic and an uncertain economic outlook. Loan values for multifamily properties flattened in 3Q2020 while one- to-four-unit investment declined for the second straight quarter, sinking 6 percent quarter over quarter.
On the bright side, single-family construction permits accelerated 6 percent in October, marking the sixth straight monthly increase after the previous month’s reading was revised upward. Houston topped the list, issuing 4,492 nonseasonally adjusted permits, followed by Dallas-Fort Worth with 4,243 permits. The metric in Central Texas reached 2,019 and 1,064 in Austin and San Antonio, respectively, pushing monthly growth to nearly 10 percent after adjusting for seasonality. On the other hand, Texas’ multifamily permits fell 6.3 percent year-to-date (YTD) compared with the same period last year due to a considerable step back in the volatile apartment sector. Issuance for two-to-four-unit buildings, however, posted an all-time high of 1,083 nonseasonally permits, largely due to new duplex developments in North Texas.
Total Texas housing starts extended an upward trajectory, although the rate of increase slowed to 2.3 percent as lumber prices were one-and-a-half times greater than year-ago levels. The Department of Commerce recently lowered lumber tariffs from 20 to 9 percent, however, which should help reduce homebuilder costs in the new year. Meanwhile, single-family private construction values continued to normalize from record-breaking activity in August, but the trend also remained positive. More than half of the monthly decrease was attributed to DFW, where values sank 14.1 percent following three consecutive improvements. The other major metros posted more moderate declines, falling about 4 percent in both Austin and Houston and 2.9 percent in San Antonio.
Record sales chipped away at the state’s supply of active listings, pulling Texas’ months of inventory (MOI) down to an all-time low of 2.1 months. A total MOI around six months is considered a balanced housing market. Inventory for homes priced less than $300,000 was even more constrained, sliding below 1.6 months. The MOI for luxury homes (homes priced more than $500,000), although elevated at 5.2 months, decreased for the fifth straight month as the influx of new listings slowed.
Inventory dropped to unprecedented levels in the major metros as well, with the metric in San Antonio matching the statewide average. The MOI dipped to 1.7 and 1.5 months in Dallas and Fort Worth, respectively, and sank to one month in Austin. Houston’s MOI fell below 2.5 months, although inventory increased for homes priced between $400,000 and $500,000, the only segment in the state’s major metropolitan areas where supply expanded.
Demand
Total housing sales rose 5.1 percent, pushing activity to an all-time high of more than 38,600 transactions during this period of historically low mortgage interest rates. The increase was concentrated in homes priced more than $200,000, which comprised nearly four-fifths of the market, the greatest share yet. Cumulative sales this year exceeded last year’s ten-month sum by 7.5 percent compared with 4.9 percent nationwide. The current rate of sales, however, is likely unsustainable given Texas’ depleted inventory.
Sales volumes in the major metros also expanded, led by Houston, where the metric surged 6.5 percent with growth across the price spectrum. Austin sales climbed 5.8 percent as YTD activity in the luxury home market accounted for 23 percent of total transactions compared with just over 18 percent last year. In North Texas, the metric improved 4.5 and 4.2 percent in Dallas and Fort Worth, respectively. San Antonio’s sales ticked up by a more modest 2.9 percent as the $400,000-$500,000 price cohort stumbled on the month.
Texas’ average days on market (DOM) slid to an all-time low of 48 days, corroborating robust demand despite the pandemic. Houston and San Antonio also posted unprecedented readings, with the metric dropping to 45 and 51 days, respectively. Austin’s DOM reached a post-Great Recession low of 35 days, while the average home sold after 36 days in Fort Worth and 39 days in Dallas.
Expansionary monetary measures by the Federal Reserve and better-than-expected economic data instilled confidence in the bond market, however modest. The ten-year U.S. Treasury bond yield inched up for the third straight month to 0.8 percent2. On the other hand, persistent uncertainty surrounding the pandemic, due to a dubious timeline for a second round of fiscal stimulus and a resurgence in positive COVID-19 cases, kept interest rates hovering at historically low levels. The Federal Home Loan Mortgage Corporation’s 30-year fixed-rate fell to an unprecedented reading below 2.8 percent (series starting in 1971). Mortgage rates also slid to decades-low levels within Texas during September, sinking to 2.92 and 2.86 percent for non-GSE and GSE loans3, respectively. The drop in rates pushed home-purchase applications up 17.5 percent YTD in October, while refinance activity advanced 73 percent. (For more information, see Finding a Representative Interest Rate for the Typical Texas Mortgagee.)
In September, the median loan-to-value ratio (LTV) and debt-to-income ratio (DTI) for the “typical” Texas conventional-loan mortgage decreased from 87.4 to 86.9 and 36.8 to 36.4, respectively. Meanwhile, the median credit score stabilized at 743 after reaching a three-decade high of 751 in June when average consumer credit scores rose during the pandemic due to early relief actions taken by the federal government and lenders, which helped some households pay off debt and save money. The median LTV of the typical Texas borrower who obtained a loan from a government-sponsored enterprise (GSE) declined from 84.8 to 83.7. The overall trend of improved credit profiles may reflect tightening lending standards as economic uncertainty prevails.
Prices
The Texas median home price accelerated 12 percent year over year (YOY) in October to a record-breaking $273,300. A shift in the composition of sales toward higher-priced homes due to constrained inventories at the lower end of the price spectrum contributed to the increase in prices. Annual price growth tipped into the double-digits at the metropolitan level as well. The median price in Austin and Dallas rose almost 13 percent each to $366,600 and $330,500, respectively. San Antonio’s metric ($259,500) jumped 10.7 percent, while Houston’s median price ($269,300) elevated 10.3 percent. Fort Worth had the smallest home price appreciation, growing 9.1 percent to $272,600.
The Texas Repeat Sales Home Price Index accounts for compositional price effects and provides a better measure of changes in single-family home values. The index suggested more moderate home-price appreciation than the change in the median price, although it still shot up 6.9 percent annually. Out of the major metros, Austin’s metric rose at a pace closest to its home-price growth, soaring 11.6 percent YOY. The index in San Antonio and Fort Worth climbed 7.4 and 7.0 percent, respectively. The Dallas and Houston indexes grew at a more moderate but still impressive clip, increasing 6.6 percent in the former and 4.8 percent in the latter.
Single-Family Forecast
The Real Estate Center projected single-family housing sales using monthly pending listings from the preceding period (Table 1). Only one month in advance was projected due to the uncertainty surrounding the COVID-19 pandemic and the availability of reliable and timely data. Texas sales are expected to decline 2.3 percent in November from October, but the YOY comparisons for the first ten months of the year are significantly positive. On a monthly basis, the metric in DFW may decrease 4 percent, while possibly falling 2.1 and 1.6 percent in Houston and Austin, respectively. San Antonio sales are predicted to post a monthly increase of 2.5 percent.
Household Pulse Survey
According to the U.S. Census Bureau’s Household Pulse Survey, 8 percent of Texas homeowners were behind on their mortgage payments during October, greater than the national rate of 6 percent (Table 2). Although the proportion of homes owned free and clear in DFW and Houston was greater than the state average, the percentage of households delinquent was also higher than the statewide rate. Twenty-nine percent of the respondents in Texas who were not current expected foreclosure to be either very likely or somewhat likely in the next two months compared with just 19 percent nationwide (Table 3). That same metric was also higher in the state’s largest metro areas, a reversal from the prior month. Currently, the Center for Disease Control’s federal foreclosure moratoriums are in place until Dec. 31, 2020. However, the Federal Housing Finance Agency has extended the foreclosure moratorium for properties owned by Fannie Mae and Freddie Mac (the Enterprises) until Jan. 31, 2021. Continued stability in the housing market is essential to Texas’ economic recovery.
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1 All measurements are calculated using seasonally adjusted data, and percentage changes are calculated month over month, unless stated otherwise.
2 Bond and mortgage interest rates are nonseasonally adjusted. Loan-to-value ratios, debt-to-income ratios, and the credit score component are also nonseasonally adjusted. Texas data typically lags the Texas Housing Insight by one month.
3 GSE loans originated during September 2020 are unrestricted based on debt-to-income ratio.
Source – James P. Gaines, Luis B. Torres, Wesley Miller, Paige Silva, and Griffin Carter (December 14, 2020)
https://www.recenter.tamu.edu/articles/technical-report/Texas-Housing-Insight
The T-47 affidavit is a document used in Texas residential real estate transactions that accompanies an existing survey. This video with Republic Title’s Janet Allen and Scott Rooker covers the following key points when a T-47 affidavit is provided:
i. Date of survey in paragraph 4
ii. Construction projects on adjoining properties predating title
iii. When to obtain a new survey
New TREC contract changes were recently announced that will go into effect on APRIL 1st 2021*. This video with Republic Title’s Janet Allen and Scott Rooker covers changes including:
*Please note: changes were made to the effective date by TREC after the filming of this video.*
Total Texas housing sales rebounded 6.3 percent in September, pushing third-quarter activity up more than one-third above depressed 2Q2020 levels. Historically low mortgage interest rates helped elevate sales, with new-home transactions increasing more than 8 percent. The Lone Star State’s homeownership rate rose to an all-time high of 70 percent, exceeding the national metric for the first time since 2012. Survey data, however, indicated Texas mortgagees may be more at risk of foreclosure in the coming months than the average U.S. household due to a higher proportion of FHA and VA loans in the state.
On the supply side, lot development slowed in 3Q2020, but single-family building permits and construction values trended upward. Additional housing is greatly needed as months inventory slid to record lows, especially for homes priced less than $300,000. Constrained inventory contributed to the near-double-digit growth in the median home price as the composition of sales shifted toward higher-priced houses. The Real Estate Center’s Repeat Sales Home Price Index also accelerated, albeit at a more moderate pace, threatening recent improvements in affordability. The pandemic remains the greatest headwind to the Texas housing market as the Center projected a slowdown in single-family sales during October amid a resurgence in COVID-19 cases.
Supply1
The Texas Residential Construction Cycle (Coincident) Index, which measures current construction levels, ticked up modestly due to improvements in industry wages, employment, and construction values. The Residential Construction Leading Index rose for the fifth straight month amid increased building permits and housing starts and a decrease in the real ten-year Treasury bill. The major metros also registered growth in their leading indexes except for San Antonio, where permits and starts fell, pulling the metric down.
According to Zonda (formerly Metrostudy), activity at the earliest stage of the construction cycle was sluggish during the third quarter as the number of new vacant developed lots (VDLs) in the Texas Urban Triangle flattened. Only VDLs in North Texas posted an increase, rising more than 40 percent quarter over quarter (QOQ) due to improvement in the $300,000 and above price range. San Antonio’s metric normalized after doubling the previous quarter but still trended upward. Vacant lot development in Austin, however, registered a one-fifth drop below 4Q2019 levels, while Houston posted its second straight quarterly decline following a yearlong climb.
Single-family construction permits backtracked 1 percent in September but remained on a strong upward trajectory after reaching an all-time high the prior month. The decrease was largely concentrated in Houston, where nonseasonally adjusted permits fell to 4,570. Nevertheless, the metro topped the national list, followed by Dallas-Fort Worth (DFW) with 4,193 permits. Issuance in Central Texas flattened at 1,843 and 905 permits in Austin and San Antonio, respectively. On the other hand, Texas’ multifamily permits almost doubled in September, rising to a year-to-date (YTD) high due to renewed strength in the apartment sector. Still, multifamily permits sank 2.2 percent QOQ.
Total Texas housing starts rebounded 20.6 percent on a monthly basis despite record-breaking lumber prices. Zonda data revealed more than 27,100 single-family homes broke ground in the Texas Urban Triangle in 3Q2020, surging 6.1 percent. Activity for homes priced less than $500,000 increased statewide and in Houston, where starts rose 24.6 percent QOQ. San Antonio registered upticks across the price spectrum, climbing 28 percent overall. Starts in Austin and Dallas, however, declined 9.2 and 7.0 percent, respectively, after just modest improvement the previous quarter.
Although single-family private construction values backtracked on a monthly basis in September, third-quarter values rebounded 32.8 percent following a decline during the second quarter. Central Texas posted the largest monthly decreases but increased 28.5 percent QOQ in Austin and 17.5 percent in San Antonio. The metric also maintained a strong upward trend in Dallas and Houston, rising 21.1 and 48.7 percent QOQ, respectively.
Record sales and a dwindling supply of active listings pulled Texas’ months of inventory (MOI) down to an all-time low of 2.2 months. A total MOI of around six months is considered a balanced housing market. Inventory for homes priced less than $300,000 was even more constrained, sliding below 1.6 months. The MOI for luxury homes (homes priced more than $500,000), although elevated at 5.7 months, decreased for the fourth straight month.
Inventory fell to unprecedented levels in the major metros as well, plummeting to one month in Austin. The metro’s MOI for homes priced less than $300,000 was just half a month. In North Texas, inventory dropped to 1.8 and 1.6 months in Dallas and Fort Worth, respectively. San Antonio’s metric matched the state average, while Houston’s MOI sank for the sixth consecutive month to 2.5 months.
Demand
Total housing sales accelerated 6.3 percent in September to an unprecedented high, boosted by historically low mortgage rates. Every price cohort registered increased activity, boosting YTD sales up more than 5 percent above transactions during the same period last year. The Lone Star State continued to outpace the national metric, which surpassed last year’s nine-month sum by 2.1 percent. The current rate of sales, however, is unsustainable given Texas’ depleted inventory.
A shift in preferences from inner-city apartments to homes outside the city center with more space supported new-home sales as well. Per Zonda, Austin new-home sales accelerated 13.1 percent QOQ to an all-time high of 5,389. Increased activity in DFW and San Antonio resulted in 10,782 and 4,150 sales, respectively. Houston sold 8,276 new homes, less than the prior quarter, but posted its tenth straight year-over-year (YOY) improvement.
Strong sales activity during 3Q2020 pushed Texas’ homeownership rate up well above the national rate of 67.4 percent to an unprecedented 70 percent (with the U.S. Census’ Current Population Survey/Housing Vacancy Survey series beginning 1996). Nationally, homeownership fell across all races and every age group, except for 65 years and older. At the metropolitan level, Austin registered the greatest homeownership rate of out Texas’ Urban Triangle for the first time in 12 years, rising almost 9 percentage points to 74.7 percent. DFW’s metric climbed to 69 percent, while San Antonio homeownership stabilized at 66.3 percent. Houston was the exception, with the proportion of owner-occupied units falling from 67.9 to 65.5 percent. Homeownership could suffer in 2021 as COVID-19 foreclosure-protection policies expire.
Texas’ average days on market (DOM) slid to an all-time low of 54 days, corroborating robust demand despite the pandemic. Austin posted the most drastic annual decline, shaving two weeks off its metric to drop to 39 days. The DOM trended downward in North Texas, falling to 42 and 41 days in Dallas and Fort Worth, respectively. Houston’s metric matched the statewide measure, while the average home in San Antonio sold after 58 days.
Low inflation expectations and persistent economic uncertainty surrounding the pandemic, in part due to a dubious timeline for a second round of fiscal stimulus, kept interest rates at historically low levels. The ten-year U.S. Treasury bond yield inched up for the second straight month to 0.7 percent2, but the Federal Home Loan Mortgage Corporation’s 30-year fixed-rate fell to an unprecedented low below 2.9 percent (series starting in 1971). Mortgage rates slid to decades-low levels within Texas during August, sinking to 3.01 and 3.07 percent for non-GSE and GSE loans, respectively. The drop in rates pushed home-purchase applications up 15.5 percent YTD in September. Refinance activity increased for the first time since March, rising more than 50 percent YTD. (For more information, see Finding a Representative Interest Rate for the Typical Texas Mortgagee.)
In August, the median loan-to-value ratio (LTV) and debt-to-income ratio (DTI) constituting the “typical” Texas conventional-loan mortgage decreased from 85.3 to 84.0 and 35.5 to 34.9, respectively, reaching multiyear lows. Meanwhile, the median credit score ticked up from 750 to 753 as average consumer credit scores have been rising during the pandemic due to early relief actions taken by the federal government and lenders that helped some households pay off debt and save money. The median DTI of the typical Texas borrower who obtained a loan from a government-sponsored enterprise (GSE) inched up to 35.6 from 35.5, but the median LTV declined to 85.3 from 85.8. The overall trend of improved credit profiles may reflect tightening lending standards as economic uncertainty prevails.
Prices
The Texas median home price accelerated 9.9 percent YOY in September, reaching a record high $266,500 as the price per square foot for existing homes posted an unprecedented $127. Annual price growth exceeded 11 percent in three of the state’s major regions – Austin ($359,300), Dallas ($326,100), and San Antonio ($261,000). In Fort Worth ($269,900) and Houston ($266,400), the median home price rose 9.0 and 8.5 percent, respectively. The shift in the composition of sales toward higher-priced homes due to constrained inventories at the lower end of the price spectrum contributed to the increase in home prices.
The Texas Repeat Sales Home Price Index accounts for such compositional effects and provides a better measure of changes in single-family home values. The index suggested more moderate home-price appreciation than the change in the median price, but it still accelerated 5 percent annually in 3Q2020. At the metropolitan level, Austin’s metric rose at the fastest pace, skyrocketing 8.4 percent, followed by Fort Worth and San Antonio, where the index jumped 5.1 and 5.0 percent, respectively. The larger metros posted home-price appreciation of more moderate rates, increasing 4.4 percent in Dallas and 3.6 percent in Houston.
Historically low interest rates supported increased housing affordability in Texas’ major metros during the third quarter, but elevated home prices slowed the upward climb established within the past year. Fort Worth and Houston were the most affordable locales with an index of 1.9, indicating that a family earning the median income could afford a home 90 percent more than the median sale price. In both Austin and San Antonio, the metric flattened to 1.7, while Dallas’ index fell slightly below that of the Central Texas reading. Continued improvement is important to Texas’ demographic advantages that have supported the state’s economic prosperity over the past decade.
Single-Family Forecast
The Real Estate Center projected single-family housing sales using monthly pending listings from the preceding period (Table 1). The Center projected only one month in advance due to the uncertainty surrounding the COVID-19 pandemic and the availability of reliable and timely data. Texas sales are expected to increase less than 1 percent in October after climbing by more than a tenth in September. Amid shrinking inventory and an upturn in COVID-19 cases, the rapid pace in Austin and Houston is anticipated to decelerate to 2.1 and 2.4 percent improvement, respectively. Meanwhile, single-family sales are predicted to tick up just 0.9 percent in DFW, and decline 2.2 percent in San Antonio.
Household Pulse Survey
According to the U.S. Census’ Household Pulse Survey, 7 percent of Texas homeowners were behind on their mortgage payments during September, greater than the national rate of 6 percent (Table 2). Although the proportion of homes owned free and clear in DFW and Houston was less than the state average, the percentage of households delinquent hovered around the statewide rate due to a greater ratio of occupants who were current on their mortgage payments. Of the Texas respondents who were not current, more than one-fifth expected foreclosure to be either very likely or somewhat likely in the next two months compared with just 18 percent nationwide (Table 3). That same metric, however, was lower in the state’s largest metro areas where local foreclosure protections may be in place. Currently, federal foreclosure moratoriums are in place until Dec. 31, 2020. Continued stability in the housing market is essential to Texas’ economic recovery.
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1 All measurements are calculated using seasonally adjusted data, and percentage changes are calculated month over month, unless stated otherwise.
2 Bond and mortgage interest rates are nonseasonally adjusted. Loan-to-value ratios, debt-to-income ratios, and the credit score component are also nonseasonally adjusted. Texas data typically lags the Texas Housing Insight by one month.
Source – James P. Gaines, Luis B. Torres, Wesley Miller, Paige Silva, and Griffin Carter (November 17, 2020)
https://www.recenter.tamu.edu/articles/technical-report/Texas-Housing-Insight
Republic Title was proud to sponsor the D Magazine State of the Residential Real Estate Market: 2021 Forecast featuring Robbie Briggs, Chris Kelly, and Dr. Luis Torres who shared their insights on the current market trends for Dallas.
You can view the event program here: https://vimeo.com/477804646/0100ac49c5
Your long home-buying journey is almost over. You found the home you love, the seller agreed to your offer and now it’s time for closing. Of course, there’s a lot to think about right now, and the last thing you want is something to go wrong. So make sure you work with an experienced closing agent to help ensure the details come together and everything runs smoothly.
As soon as the seller accepts your offer, the behind-the-scenes work begins. You can expect closing to happen within 30 to 90 days.
If you are working with a real estate agent, with your permission, he or she may place an order with a closing agent/title company as soon as your sales contract is accepted.
Most homebuyers rely on their real estate agent to select a closing agent—someone they work with regularly and know to be professional, reliable and efficient. However, you can choose your own closing agent if you wish. The closing agent will oversee the closing process and make sure everything happens in the right order and on time, without unnecessary delays or glitches.
Once your contract has been signed by all parties it is then delivered to the closing agent/title company of your choice. The closing agent reviews the contract for completeness. The agent will also deposit your earnest money into an escrow account, where the funds will remain until closing.
Once the title company receives your contract, the title company conducts a search of the public records. This should identify any issues with the title such as liens against the property, utility easements, and so on. After the title search is complete, the title company will provide you with a title commitment.
There are two kinds of title insurance coverage: a Lender’s policy, which covers the lender for the amount of the mortgage loan; and an Owner’s policy, which covers the homebuyer for the amount of the purchase price. If you are obtaining a loan, the bank or lender will typically require that you purchase a Lender’s policy. However, it only protects the lender.
It is always recommended that you obtain an Owner’s policy to insure your investment. The Seller generally pays for the Owner’s policy and the Buyer generally pays for the lender’s title policy.
Your lender or the closing agent will provide a Closing Disclosure to you at least three days prior to closing that will show all of the charges and credits and what amount you have to bring to closing. Please note that any amount over $1,499.99 must be sent to the closing agent by wire transfer or cashiers check.
If you or your lender makes certain significant changes between the time the Closing Disclosure form is given to you and the closing, you must be provided a new form and an additional three-business-day waiting period after receipt of the new form. This applies if the creditor:
If the changes are less significant, they can be disclosed on a revised Closing Disclosure form provided to you at or before closing, without delaying the closing.
As closing day approaches, the closing agent orders any updated information that may be required. Once the closing agent confirms with the lender and the seller, he or she will set a final date, time and location of the closing.
On closing day, all of the behind-the-scenes work is complete. While you’ve been busy packing, ordering utilities and coordinating the movers, your closing agent has been managing the closing process so that you can rest assured, knowing all the paperwork is in order.
This is a brief description of insurance coverages, products and services and is meant for informational purposes only. Actual coverages may vary by state, company or locality. You may not be eligible for all of the insurance products, coverages or services described in this advertising. For exact terms, conditions, exclusions, and limitations, please contact a title insurance company authorized to do business in your location.
You’re a real estate agent, so you know that buying a home can be overwhelming for many of your clients. Homebuyers can easily feel confused and frustrated by the mounds of paperwork they have to sign. Plus, all the fees associated with closing can sometimes be a surprise even to an experienced buyer.
Owner’s title insurance is one of those items often misunderstood by homebuyers at closing, yet its value is tremendous. As an important advisor to your clients, you are in the position to help them understand the value of owner’s title insurance and the dangers that can be incurred without it.
Owner’s title insurance is a policy that protects homebuyers’ property rights. For the same reasons that the bank requires a lender’s insurance policy, a homebuyer obtains owner’s title insurance to protect their legal claims to the property.
Say, for example, your client recently purchased a new home from a builder, but the builder failed to pay the roofer. Wanting to be paid, the roofer filed a lien against the property. Without owner’s title insurance, your client would be responsible for paying this existing debt—meaning they’d be paying the roofer out of pocket instead of purchasing something nice for their new home, like new living room furniture. This is just one example of how owner’s title insurance protects homebuyers’ from various significant risks. With owner’s title insurance, your client would be protected from certain legal or financial responsibilities.
The good news is that owner’s title insurance protects homebuyers, as long as they or their heirs* own the home. For a low, one-time fee, homebuyers can know they are protected from inheriting existing debts or claims to their property.
In Texas, title insurance is regulated by the Texas Department of Insurance. In addition, the Consumer Financial Protection Bureau (CFPB) regulates closing and settlement practices which can impact title insurance. Keep in mind that title insurance industry practices vary due to differences in state laws and local real estate customs.
Together, real estate agents, land title insurance professionals and other stakeholders involved in real estate transactions can provide homebuyers with the protection they deserve during the home closing process. For more resources relating to title insurance and the homebuying process, visit: www.republictitle.com/residential-resources
*This advertising offers a brief description of insurance coverages, products and services and is meant for informational purposes only. Actual coverages may vary by state, company or locality. You may not be eligible for all of the insurance products, coverages or services described in this advertising. For exact terms, conditions, exclusions, and limitations, please contact a title insurance company authorized to do business in your location.
The September 2020 DFW area real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!
To see past month’s reports, please visit our resources section here.
For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.
Here is the August 2020 Summary from Texas A&M Real Estate Center.