Welcome to my June post about Real Estate in Fort worth and surrounding areas. In these monthly posts, I go over some numbers all buyers and sellers should know before entering the market. I also explore three news articles that caught my attention over the last month. June used to be one of my favorite months of the year. Summer started and I found myself spending a lot more time with my kids. Nowadays, they are both grown (both still live at home) and are busy with their lives I get to spend more time with my wife, however, so it is a fair trade off in my mind.
Our first article this month deals with the reduction in the number of flips we are seeing the Dallas-Fort Worth market. Nothing about this Dallas-Morning news article really surprises me. The investor real estate market in the area has taken a serious dive in the last quarter (as I wrote about in this post). Dallas saw 2% less flips in the first quarter of 2019 compared to the year before. Nationwide, there has been a 8% decline in flips. Surprisingly, Dallas is still seeing more flips than most other parts of the country. We had 1100 flips which is ninth place out 135 metro areas. The article has a lot of great stats about flipping in the area so be sure to read it. If you are newbie investor, you especially need to read this one before getting into the business at this time.
As many of my readers know, I am a proud citizen of the Alliance Corridor, which goes from Loop 820 up to the Racetrack. I am a big fan of Ross Perot Jr and his company Hillwood properties for the amazing work they have done in this area to develop it into one of the most unique areas in the state. Our second article is an announcement about some additional acreage the company has bought that will extend the number of companies that will set up shop in the area. With more jobs, more people will move to the area, which is good for real estate development. Here is what they bought.
The acreage will add to Hillwood’s portfolio more than 36 million square feet of potential industrial development space in Tarrant and Denton counties. Hillwood could use the acreage to offer logistics, manufacturing and aviation developments near Alliance Airport, according to a press release.
Our third and final article this month deals with the rise of apartment rents in the area. Suburbs saw a larger increase (4.6%) than the city centers (2%). Plano and Irving saw the largest increase in rents. A two bedroom apartement in Plano nows averages $1540 a month. In Irving, the average is $1,230. I decided to pick this article to highlight how high these rents are getting in the area. Mortgage rates continue to decrease with some buyers getting mortgage rates below 4% right now. With the mortgages being that low, renters need to think again about purchasing a house. Do you really want to pay the same monthly for a two bedroom apartment as you might for a house? Just something to think about for buyers in the area.
May Months Supply
In May, we have been lucky to see a slight increase in inventory to 2.4 months, which is about 9% higher than this time last year. We are about 14% higher in inventory than we were two years ago.
What this means for sellers: Sellers have had it really really good over the last four years with inventory so low that buyers were lining up to see any houses. We are still historically low in inventory, but the rush days of yesteryear has come to an end. Sure, you will still have some homes that go quickly due to the high demand. Sellers need to face the fact that they might have to deal with showings longer and be ready to adjust price expectations before putting the home on the market.
What this means for buyers: Buyers should rejoice at the additional options at their disposal with higher inventory numbers. Of course, different price ranges bring different levels of options. If you are looking for a property below $200K, you will still have limited options. If you have the means to go higher, then you will see more homes on the market. Be sure to plan with your buyer’s agent on your approach to showings and offers. It is still a good idea to have the ability to move fast if a hot property comes on the market.
May Average Days on the Market
Average days on market has gone up considerably in the last two years in Fort Worth with an over 30% increase for the length of time. We are currently seeing homes stay on the market for 37 days as compared to 31 days last year and 28 days in 2017.
What this means for sellers: With buyers having more options, it only makes sense that homes will not sell as fast in Fort Worth. Sellers will need to sit down with their listing agents to discuss what needs to be done on a daily basis for buyers. You need to keep the house very clean and keep clutter to an all time low. With this slowdown, you will be doing more work on regular basis to keep your house show ready. Sellers should remember the end result of their work. Their house will be sold!
What this means for buyers: Buyers should feel like the current climate is a nice leisure vacation compared to a few years ago. You actually have time to shop around a bit. If you can’t find the right house right away, the one down the street has a good chance of still being there the next day. Buyers who left the market out of frustration should be very excited about coming back.
May Average Sales Price
The trend of lower sales appreciation has continued into the fifth month of the year with only a 3.1% increase in sales prices to $273K. It has been a couple of years since we saw the double digit increase in sales appreciation.
What this means for sellers: Seller should take note that the sales prices continue to creep up in Fort Worth, but not at the same pace as previous years. With this in mind, it is even more important not to overprice your home. Your listing agent should give you a range for the price. You need to stay in that range or your house might linger on the market.
What this means for buyers: With the slower appreciation, buyers will be getting more house with their lower interest rate mortgages. Buyers should take this opportunity to research lenders and find one that can give them what you want with a mortgage. There are lots of nice programs out there. Shop around!