Dallas-Fort Worth may have hit the economic and housing bottom, with nowhere else to go but up. At least a pack of rich developers in Dallas' Uptown area think so.

But first the bad news.

According to the Foreclosure Listing Service (FLS,) the entire Dallas-Fort Worth Metroplex is in trouble, with the highest foreclosure rate in the country. Over 2,800 homes will be on the auction block June 7, 2005. While some surrounding counties had larger increases in foreclosures, Dallas County had a nothing-to-be-proud-of increase of 23 percent over last year, double the foreclosure rate of the rest of the state.

"People continue to find themselves in predicaments with high credit card debts, and they have gotten into too large of a home loan," said George Roddy Sr., president of FLS. "It's an indicator of the times we're in."

The April figures from RealtyTrac for Dallas-Fort Worth spell out the numbers -- one foreclosure for every 319 households -- 5.5 times the national average.

If people can get in debt over their heads, they will, and they're being encouraged by low-interest, interest-only, low-down-payment, hybrid and home-equity loans that allow them to buy "too much house." They also may be making poor credit decisions, taking on too much debt along with too-large home loans. Dallasites have always been image-conscious, a vanity that isn't served well by a no-holds-barred borrowing climate.

Dallas-Fort Worth was hit hard by the post 9-11 technology and business bust. Lack of home appreciation hasn't helped. Except for select pockets, overall home price appreciation in North Texas has barely kept up with inflation, while many areas on the coasts and across other parts of America are still reporting double-digit increases.

As a major city, Dallas has the least home price appreciation and job growth for a city of its size in the South/Southwest ranking it along with the worst of the northeastern cities that are losing population to the South.

Even its central hub is in danger. The Dallas-Fort Worth International Airport, with the second highest traffic rate in the world, is weathering bankruptcy clouds by some of its major carriers including Dallas-Fort Worth-based American Airlines. Hovering above AA's exposed throat is Southwest, which hubs out of Dallas' Love Field. The carrier is campaigning to have The Wright Amendment overturned, which restricts flights from Love Field so that carriers don't compete so heavily against DFW. If that happens, it could help bring boom times back to Dallas' inner city, but at the expense of the rest of the Metroplex.

Now the good news. There's a lot to suggest that Dallas and its surrounding areas have hit their economic and housing nadir and could be poised for the housing boom that the rest of the country has already enjoyed.

With a population well over 5 million, the Metroplex is the largest market in the Southern U.S. and ninth largest in the nation. It isn't losing population -- it's gaining. According to the Greater Dallas Chamber, DFW added 325 people a day to its population during the 1990s and continues the same levels today, bringing the 2004 population to 5.8 million residents despite flat economic performance and net job losses in 2002 and 2003.

Census 2000 says the median age of the Metroplex is 32.1 while the national age is 35.3, making it attractive to employers who want a large "working-age" base from which to recruit help.

According to RELO®, a large network of independent residential real estate firms, Dallas is in the top five "hottest relocation" destinations in the country. Census Bureau Texas Water Development Board says that between 2000 and 2030, the diversified population of the Metroplex is expected to grow by 2.7 million people to almost 8 million.

Housing is being built as fast as the builders can do it, and much less expensively than many parts of the nation. The ACCRA Cost of Living Index consistently reports that housing in the DFW area is approximately 20 percent below the U.S. average in cost.

Dallas still has big problems -- a gridlocked city council, low-performing schools, runaway crime and few incentives for big business, in addition to its embarrassing foreclosure rate, but that isn't stopping many speculators from betting on the come.

A lot of luxury builders and developers believe that Dallas is going to have a lot of money and soon, and that image-conscious Dallasites will spend big to live in Uptown, north of downtown Dallas.

Puttin' on the Ritz

One interesting development is the sudden and prolific numbers of luxury hotel-managed residential properties that will be built around Dallas' decaying downtown. These properties offer their condo buyers a wide range of amenities from spa treatments to room and maid service. All are located in Uptown.

• The Ritz-Carlton Hotel Co. LLC is building a 21-story hotel and residential tower north of downtown Dallas, slated for a 2007 completion. The tower will feature a 217-room Ritz-Carlton-Dallas hotel on the first eight floors, along with a restaurant and bar, 14,000 square feet of meeting space and a 10,000-square-foot spa and fitness center. The residential tower will have 70 luxury residences, priced at $1.3 million for a two-bedroom home to more than $6 million for the four-bedroom penthouse.

• Hotel Zaza, a unique boutique hotel in Uptown known for its concept suites with distinctive themes like "Far East," "Metropolitan," "Shag-a-Delic" and "Out of Africa", is owned by Charlie Givens and located just north of downtown. Adjoining the hotel is The Metropolitan Club, condominium residences which connect to the hotel with a separate entrance and allow its owner-residents access to hotel amenities. Eight floor plans range in size from 1,200 square feet to 2,175 square feet. Prices range from $280,000 to $535,000.

• Billing itself as Dallas' new urban center is Victory Place, northeast of downtown Dallas, where Starwood (Tom Hicks and company) is building the W Dallas Victory Hotel and Residences, along with proposed shops, restaurants and office space. Approximately 80 residences will be built on top of the 270-room hotel. Prices will be about $400 per square foot for the condominiums, approximately double new home price-per-square-foot in the rest of the Metroplex. Homes will range from $400,000 to over $1 million.

• While it's not a hotel, the Azure plans to offer hotel-like amenities to its condominium buyers. Over 200 units are being built in a 30-story tower with prices beginning in the $400s for one bedroom homes.

Why such expensive optimism? By all rights, there shouldn't be. Dallas-Fort Worth is spread out with a lot of competition from neighboring cities such as Frisco which is building its own convention center and Arlington which has wooed and won The Texas Rangers baseball team and The Dallas Cowboys football team from Dallas as well as a number of major entertainment venues. Grapevine is attracting a number of visitors away from DFW with its huge Gaylord Texan Resort hotel and wineries. Even tiny Justin, Texas has something to brag about - it's the home of Texas Motor Speedway. But the more Dallas and Fort Worth have sprawled, the further away these entertainments are. Jobs are spotty and more often located in office parks instead of the central downtown area, which has been kept alive by a too-busy court system.

People are sick of driving, driving, driving, and that's because the population is growing faster than new roadways can be built.

According to a 2004 WFAA-TV news report, Dallas, Fort Worth and Arlington recorded the greatest leap in traffic congestion across the country from 1982 to 2002.

Another solution is congesting the congestion, which is one reason why the Uptown north of downtown Dallas has been one of the few pockets of appreciation in the city. Living may be limited to condos, townhomes and the occasional Victorian re-do, but walking or hopping a trolley, bus or light rail to restaurants, shopping, entertainment and even jobs is easy.

"We can't just build new roadways," said Scott Cooner of the Texas Transportation Institute said. "We've got to look to mass transit; we've got to look to people changing their schedules (and) a variety of land-use planning. It's got to be a variety of solutions to get us ahead of the curve."

Let's just hope that the city will attract enough jobs so that the optimistic buyers of these new condos and other projects don't set new records for foreclosure.

Published: June 1, 2005

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.