Welcome to the next edition of the Fort Worth Market Update . For this update, we will be looking at homes under $150K In this price point, we continue to see a very low inventory in Fort Worth. Many buyers can only qualify for properties in this price range yet have few options when it comes to available homes.
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.
We are changing a few things about our Market Updates. Some of the statistics we have been highlighting are not really useful for consumers so we have taken them out of the report. Average sales price will no longer be featured. If you are curious about this statistic, you can look at the monthly broad market update I do, where the statistic is much more relevant. In its place, we have added the statistic, average percent of original list price. We feel this statistic will be much more useful to buyers and sellers.
Our second change is adding this price range of $150K or lower. We realized that many investors would find the data we convey here useful for their real estate businesses. Investors, how buy flips or rentals, should find this information handy to keep around as they build the annual strategy.
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 August 2019)
Homes for Sale
In this price range, we have seen a 45% decrease in the number of homes for sale in July since 2017. In July 2017, we had 264 homes for sale while this year we had 146.
What this means for sellers: Sellers in this price range have had it very good for a long time. With the number of homes for sale getting lower every year, if you have a house under $150K, there is a good chance you will sell your home on your terms. You also have to take into account the Ibuyer. These huge companies basically flip homes to make their money, but have a wide reach due to their funding levels. Since many of these companies will buy homes over $100K, you have to wonder if sellers are taking the easy path despite the loss of profit. If the house sells to an Ibuyer company, it never appears on the MLS so numbers might be down for that reason.
What this means for buyers: Buyers in this price range have not seen many homes for sale for several years now. If someone is looking for a house under $150K, you need to move fast and offer aggressive terms to the seller. Most likely, these homes will have several offers within the first 48 hours, many coming from investors. Buyers looking for a place to live would do well for themselves by thinking like an investor and tell their agent to make similar offers.
We saw an decrease of nearly 20% of new listings in this price in July. In 2017, we saw 194 new listings under $150K in Fort Worth. This year, we saw 129. This is the second straight year of decrease as 2018 we saw 160 new listings.
What this means for sellers: With so few listings, sellers in this price range should think twice before selling to an investor or Ibuyer company. Investors will offer lower prices to realize a larger profit when they resale the property or rent it out. Ibuyer companies charge a service fee well over the traditional 6% realtors fee. In other words, if you want to save your hard earned equity, you would be well-served to put your home on the open market with a Realtor. You will most likely get the terms you want for your property.
What this means for buyers: Buyers should sit down with their real estate agent to go over their strategy if shopping in this price range. If you are looking for a home to live, you will need to be some time in your schedule to see a house quickly, or at least have your real estate agent go see the home for you. Most sellers will not take offers from buyers who have not seen the house. Your buyer’s agent should set up a MLS portal for you that will send you listings as soon as they come on the market. In this way, you can be one of the first to see the property and get your offer into the seller.
Average Pct of Original List Price
Sellers are getting 94.6% of their original asking price in this price range. This is better than in 2017 when sellers were getting 97.6% or last year when sellers were getting 98.7%
What this means for sellers: In any transitioning market, you will have a statistic that makes less sense than other ones. The low number of homes available would seem that logic would dictate that sellers were getting higher percentages of their asking price. As you can see, however, this is not the case. One possible explanation is the perception the market is slowing down so sellers are willing to negotiate lower price based on unfounded fears the market is turning towards buyers.
What this means for buyers: This statistic should be presented to buyers when they are considering an offer on a home. Sellers’ willingness to negotiate is based on what they think they can get for a home. If they are being told 94% of asking is a good target, buyers should offer nothing lower in their initial offers.
The months supply for this price point remains very low. In July of this year, we saw 1.5 months supply versus 1.3 last year. In 2017, we saw 1.4.
What this means for sellers: As it has already been written, the low inventory of homes on the market is a boon for sellers in this price point. We are in a seller’s market for the foreseeable future as it will take years for the inventory to get above 6 months, which is considered a healthy market. If you are holding off on selling your home due to the changing market, no need to wait. Do it now!
What this means for buyers: Buyers can make their offers as attractive as possible by taking costs off the table for the seller. For example, sellers will traditionally purchase a title insurance policy for the buyer. A buyer can offer to purchase the title insurance instead. Surveys are another cost buyers can take off the seller’s hands to make their offers more attractive. Be sure to speak to your agent on other aggressive terms you can use in your offers.
In July 2019, we saw 79 closed sales in this price range in Fort Worth. This number is down over 50% from two years ago when we saw 164 closed sales in this price range.
What this means for sellers: This is another confusing statistic for this price range. One would expect more closed sales as buyers are picking up any home they can find on the market. Ibuyers might be playing a role here as well as these sells are not recorded in the MLS. It could also be that buyers are holding off buying right now with talk of a looming recession.
What this means for buyers: Buyers should not be fooled by this statistic. If you want to purchase a home in this price range, you should follow the advice of your buyer’s agent to be ready to move fast. This statistic will probably go up in future reports as more buyers enter the market due to the low interest rates.