Texas sees housing boom; shortage sparks bidding war

[BOSTON] After losing his third bidding war for a Dallas-area home, Johnny Tseng offered the winner US$10,000 to walk away. The buyer declined.

"I thought I made an attractive offer," said Mr Tseng, a 31- year-old financial analyst for a Dallas-based commercial bank. "But if I were under contract right now and somebody came along and offered me money, I would be hesitant. There just aren't that many options out there."

Texas, known for its open spaces and cheap property, is experiencing the types of property bidding frenzies seen in tightly built markets from New York to San Francisco as job gains generate a suburban land rush. Existing-home prices in Dallas and Houston are rising faster than at any time since the oil boom of the 1980s. Homebuilders, caught off guard by the ferocity of buyer demand, are exhausting construction-ready lots as they struggle to recruit workers to complete houses quickly.