Welcome to the July edition of my monthly post about real estate in Fort Worth. I realize that it is August, but the last week in July overlapped with the first part of August. I always write this post the last week of the month so that is why you are reading about July in August. You can still get the same sense of the real estate market in Fort Worth.
For my first story this month, I am going to highly recommend you spend some time reading this Inc.com post about OpenDoor. I thought I knew OpenDoor, but this article really shines some new light on the company. I especially like the fact that the founder has been in real estate for awhile since he used his scholarship funds to buy a house (this doesn’t sound legal to me). I also learned that OpenDoor has had some major issues with people living in their listed properties. One poor realtor has stumbled across someone doing crack cocaine in the master bedroom. She won’t go into any OpenDoor home now. One agent will always carry a concealed weapon when showing OpenDoor homes. I personally have shown several of these properties without any issues. It was an eye opener. For this reason, I designate this post the “must read” of July.
The next blog comes from my favorite real estate writer, Steve Brown from the Dallas Morning News. This post does a great job outlining how sellers are having to reduce their original list price We are seeing more homes on the market so buyers are being more picky with their offers. I don’t know if I buy the rationale to justify their findings but it is still an interesting statistic. Be sure to keep reading to get my insight on how this development affects sellers and buyers.
“The average discount was 2.9%, and 25.4% of homes sold for a discount of 5% or more,” Knock communications director Rachel Rampino Conner said. “The high tier (over $363,740) of price ranges saw the highest rate of discounts at 77.8%, however the low tier (under $270,162) saw the biggest increase year-over-year at 11.62%.”
The last article I am going to highlight this month comes from WFAA.com. It highlights how some brokerages are ramping up the old boring house format. One brokerage had a house party featuring a local rapper. One other agent had themed open houses including Star Wars and super bowl party. I’ll just leave this great video here for you to watch.
June Months Supply
We saw a 13.6% increase in the months supply in June 2019. In 2018, we had 2.2 months supply in Fort Worth, which is lower than the 2.5 months we realized this year. In 2017, we saw a 2.0 months supply
What this means for sellers: Inventory continues to be tight in Fort Worth, falling a good four months short of what many considered to be a healthy market (six months supply). Sellers should still seriously consider putting their homes on the market with so little homes for sale. However, they should set their expectations for the buyers to be more picky about their house and possible seeing less showings. With even this little increase, many buyers are being more cautious on making offers.
What this means for buyers: Buyers should be feeling good about the market right now with two straight years of increased inventory. The mortgage rates are at a low, and with the Fed lowering their prime interest rates this month, they rates might even go lower. It is a nice feeling for buyers to realize that more inventory means they will be getting more house for their money and spending less on the mortgage.
June Average Days on Market
The average days on market went up in Fort Worth to 41 days, which is over 25% higher than two years ago when it was 32 days on market. Last year, we saw 36 days as the average days on market.
What this means for sellers: Sellers need to be prepared to have their house on the market longer as inventory has gone up and buyers are being more selective in their purchases. What does a seller do if a house remains on the market too long? Listing agents should have a bag of tricks to get more traffic to their listings. Listings agents should be able to market to a wider audience, hold broker open houses and even ramp up the online ad budget. Of course, many of these costs will be handed to the seller. The number one reason a house stays on the market has not changed. It is overpriced!
What this means for buyers: Buyers are taking longer to make decisions on homes which makes sense considering the extra options available on the market. Buyers are seeing a lesser number of multioffer situations and can wait out a house that is overpriced for a price adjustment. Buyer’s agents should be focused on their buyer’s wish list when helping buyers make decisions on homes. After all, you have the opportunity to be more picky about the house, which means you get more items on your wish list.
June Average Sales Price
The average sales price in June 2019 was just over $259K. This is a slight jump from 2018 when the average sales price in Fort Worth was $250K. In 2017, we saw an average price of $233K.
What this means for sellers: Price appreciation is still a reality for sellers in Fort Worth. However, the price increases have only gone up marginally compared to previous years. With single digit increase over the last two years, sellers need to adjust their thinking about how much they list their home. If you want the house to go fast, which is always recommended as buyers have short attention spans, you need to be willing to price your home aggressively. You should price it at the bottom of the range, or even lower than the range. We are seeing more and more listings decrease in price to the point where buyers feel they can just wait until the seller lowers the price before making an offer.
What this means for buyers: Buyers are loving this new reality for house hunting in Fort Worth. The days of rushing to get a house before prices escalated is over for now. Buyers know to wait until a house has been on the market for awhile before jumping on it. Most likely, they will get the lower price. Of course, there is always exceptions, so if you see a house that looks good and is priced well, you still have to move quick to get it.