Welcome to the next edition of the Fort Worth Market Update . For this update, we will be looking at homes in the price range of $300K to $400K. In this price point, we are getting closer to the level of luxury homes ($500k or higher) with less buyers and even less options for these buyers.
Our methodology for this Fort Worth market update is straightforward. We use the North Texas Real Estate Information Services (NTREIS) to present you with a broad overarching look at Fort Worth for this price range. For those who do not know, this multiple listing service is the place real estate agents advertise their houses for sale. Each listing will have certain required data. NTREIS then compiles and manages this data to allow for use by its members to keep buyers and sellers appraised of the market conditions in the Dallas-Fort Worth area.
If you are looking for a specific region to get numbers, please let us know. We can focus specific areas from certain neighborhoods, zip codes and draw specific areas We will work with you to give you the data you need.
With this Fort Worth market update, we would first like to show you the spread of the location of houses in this price range. (as of January 2019)
Homes for Sale
The numbers show 432 homes in the price range for sale in December 2018, which is a 10% increase from 2017 and over a 30% rise from 2016. From our last report in November 2017, this number is down from 612 homes for sale. December has always been slower than the rest of the year due to the holiday activities and colder weather.
What this means for sellers: Sellers should remain confident that their homes will sell with this few homes on the market. It might take longer due to more homes being available, but we are still looking at very few options for buyers. If you house has been on the market for more than 30 days, you need to discuss tactics with your listing agent. There are several steps you could take to get the house in front of more buyers including lowering the sales price, hold some additional open houses and even do a different marketing campaign. You could also consider making some additional upgrades to the house, and then get the pictures retaken so buyers have something new to consider when looking at your property online.
What this means for buyers: For a city the size of Fort Worth (800k+), 432 homes for sale in this price range is very low and does not bode well for buyers looking in this area. However, we are better off than we were two years ago when only 300 properties were available for buyers. Buyers need to patient and diligent at the same time. Don’t give up the search too quickly, but don’t get lazy in looking at properties and making offers. House hunting in this tight market is more of a marathon than a sprint.
From the graph below, you can see that we had 113 new listings in this price range in December 2018, which is a 2% increase over 2017. It is a 30% increase from December 2016. Why are we seeing less new listings? The time of year can play a part in new listings as December tends to a slower part of the real estate year. All the doom and gloom in the news could also be leading many sellers to believe that selling their homes right now is not a good idea. As we all know, perception has a lot to do with how markets perform from year to year.
What this means for sellers: Sellers who are thinking about entering the market, but seem to be hesitating because of the economic news, need to reach out to their realtor to discuss how their neighborhood is performing in comparison to the entire market. Real estate is still very dependent on the location of the property versus the property itself. A small house in this price range located in the Historical Fairmont area could be the same price of a very large new development in North Fort Worth. Sellers should not be shy about selling their houses based on the macro economics we are seeing in today’s news.
What this means for buyers: For buyers in this price range, this means they will be seeing fewer new options in the first months of 2019 as sellers forego listing their homes. Builders are more likely to have more properties in this price range than some of the other lower price points. Builders have figured out that they get a bigger profit by selling higher end homes than those on the lower end. If you are interested in a new build, you should reach out to your realtor to discuss the many approaches you can take as well as the pros and cons of taking this route. It is not for everyone.
Average Sales Price
For this price range in Fort Worth, we are seeing the average sales price just below $340k. This average sales price has not really changed much in two years. Most homes are selling in the lower part of the range. As with other reports, the average sales price in a specific range should be a guide to buyers and sellers on the general idea of the price point of closed sales. It should not be used to determine appreciation. For true picture of sales appreciation, one has to look at sales comparable for your immediate vicinity usually half mile from your home.
What this means for sellers: Sellers in this price range in Fort Worth should consider this statistic as a guide on how much competition they will have when placing their home on the market. If your home is close to the average price, you can expect to find more homes competing against your property. The number one factor in selling a home is the list price. You need to make sure your listing agent has done a proper job looking over sales comparison reports and given you an accurate range to select a list price. Sellers should consider the lower part of the range as dropping price in this market raises questions on why the price had to be dropped. Is there something wrong with the house?
What this means for buyers: Buyers who are shopping for homes near $340k will have more options than higher price points. To help with narrowing down the possible properties to make offers, you might want to develop a scorecard with all your wants in a property. This scorecard could use weighted scores to help you build a nice grade for each property you visit. For example, if granite counter tops in the kitchen is more important for you than having a large pantry, you could weight the counter tops a 10 while the pantry a 3. You give scores on each characteristic from 1 to 3 and then multiply by the characteristic’s weight. Then again, house hunting is sometimes more of a feeling than a score so don’t deny your gut feeling on a property.
The amount of time it would take for the current inventory of homes in this price range to sell out in Fort worth actually went down 3.3% since this time last year. This means it would take a little over 3 months to sell out of homes in this price range. What is strange about this statistic is that we have seen increases in the number of homes for sale and the number of new listings? Why would it take less time for these homes to sell out? Statistically, the number has not really changed much since 2016, being around 3 months. One possible explanation is that there are more buyers in this price range so homes are not selling any faster or slower, but about the same over the last three years. It could also be one of those quirks of a market in flux when statistics don’t always make sense.
What this means for sellers: Sellers should discuss these statistics with their listing agents to see if they need to change their tactics. When statistics are pointing to a market in transition, it is important for sellers to try to get in front of it by taking steps to get their house noticed sooner versus later. What can you do as a seller to make your home stand out? What can the listing agent do differently? One idea is to give your curb appeal a once over to see if there is something that will make it more appealing to buyers. There is nothing like a first impression to leave a lasting image in the minds of buyers.
What this means for buyers: Buyers would be well advised, like sellers, to sit down with their buyer’s agent to see if changes to their house hunting need to be made. With all the news and strange statistics pointing to a possible market shift this year, you might think about the need to move your house hunting up a bit in the year. You might be able to find a home that might have fallen through the cracks and just hasn’t sold during the slower parts of the real estate year.
With closed sales, we see a 14% decrease in this price range in Fort Worth. This follows a 20% increase from 2016 to 2017. What is going on here? These statistics don’t make much sense do they? Brokers are mystified as well. This CNBC post outlines how brokers are baffled by the recent numbers. The recent drop in home sales is unusual, because it was not coupled with a large economic event like a recession. The post says the number drop was one of the largest in history when nothing external happened to cause it.
What this means for sellers: Sellers should take these closed sales numbers at arms length until additional time has passed. It could a fluke, or it could be the start of new downward trend in sales. Time will tell. In the meantime, sellers should hold course and keep making their homes presentable for buyers and be patient waiting for the buyer who will buy their house. In other words, it is not time to panic (yet).
What this means for buyers: Like with the other numbers in this post, this number seems to indicate buyers will have more time to find homes as not as many are selling. You will have more options and possible more sellers willing to negotiate on their asking price. Be smart, but stay diligent for the market might surprise you!