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. North Fort Worth has the higher concentration of homes for sale in this price point with central Fort Worth looking good as well.
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 September 2018)
Homes for Sale
As one can imagine, the number of homes that come on the market in this price range is fewer in number than the other Fort Worth Market Updates. However, as can be seen from the graph below, the number of homes in the last two years has grown dramatically at 58.9%. We had 581 homes for sale in this price point in July. For sellers in this price point, it is an indication that the market will continue its slow down as more options become available to buyers. Sellers should consider hiring a interior designer or a stager to make their home look more appealing to buyers. You will have much more competition and a house that shows well will stand out among the other properties for buyers. Stagers range in their services from pure consulting on how to arrange your home to those that provide furniture for use in your home during showings. You also have the opportunity to use a virtual stager for rooms that are difficult to change before showings begin.
As with the overall homes for sale, we have seen a dramatic increase in the new listings this last July with a 31.7% more new listings than the previous year. We had 262 new listings in July. For buyers, this means the slower pace of the market will allow them to relax a bit on getting out to see properties and put in offers. Buyers should still move quickly on homes that show very well and priced at market rate. However, if the property does not fit your standards, you can expect other properties will be available for you to see. You should ask your agent to track properties for you and alert you when the properties on the bubble go down in price. Price reductions are much more numerous than we have seen in the recent past so you should have several properties that will be on the bubble.
Average Sales Price
The average sales price in this price range has remained basically flat over the last two years. As you can see on the graph, the average price in July was $341,232, which is slightly lower than the previous July and only one dollar more than two years ago. High end flippers should take this into consideration when evaluating their properties. Price appreciation will be non-existent so the purchase price will need be closer to the 70% After Repair Value(ARV) number so many use to evaluate investor properties. Many investors in other price points have been able to get away with higher percentage of ARV because the price appreciation would be there when the property came back on the market. You have to get in with properties that give you enough room for rehab and fees to turn a decent profit at this price point.
Average Price per Square Foot
Average price per square foot has also remained flat over the last two years at $129 per square foot. Sellers should discuss with their agent how this changes their strategy when it comes to finding buyers. With no price appreciation and an new influx of listings coming on the market, you can’t put a sign in your yard and expect to sell the property. You will need to find ways to attract buyers to the property. One trick is to offer more open houses with prize drawings to attract more buyers. You should also discuss with your agent any issues with your home that will make it less appealing to potential buyers. One idea is to get in front of the issue by turning it around in a positive light. For example, if the home needs new flooring, you can offer an allowance for the buyers to update the flooring after moving into the property.
The months supply is a statistic that the industry uses to determine what kind of market exists within a price point and geographic area. If you have a market with six months or less homes currently for sale, you are in a seller’s market. Most of the DFW area has seen a two months supply for the last several years, indicating a strong seller’s market. With this price range in Fort Worth, we are seeing a much higher number, although it did drop down slightly this July to 3.9 months. This decline coupled with the larger number of homes on the market is an indication that some buyers are leaving the market. If you are looking for a house in this price range and recently stopped looking for the house, you should call your real estate agent to ask about looking again With the recent influx of new listings, you might find the market is more favorable right now than it has been in several years.
With a 50% increase in closed sales this July from this time last year, there really isn’t much more to write here. The number speaks for itself. With more listings and more homes for sale, you are going to have more closed sales. Buyers take note. It is time to come back to the market!