Welcome to my regular update on how the market looks for real estate in Fort Worth. We’ll look at October 2015 numbers with this blog post. I hope you can get a sense of where the market stands right now. Overall, we have seen home ownership rise for the first time in two years, after some dismal rock bottom numbers.. In DFW, we have seen the housing inventory go up after some very low number of homes for sell. We saw a 1 percent increase across the North Texas area with more than 20 thousand homes for sell on the market. This number reflects some of my own experiences with homes being on the market longer than before, some even reaching normal days on market levels. The Alliance Corridor, my area of concentration, continues to grow at record levels with an UNT professor stating the following.
John Baen, a real estate professor at the University of North Texas, boldly says Alliance has the potential to become another Silicon Valley with several large corporate campuses. He said he also wouldn’t be surprised if someday Fort Worth Alliance Airport opened to commercial traffic.
Silicon Valley of North Fort Worth! Would that not be a great designation for real estate in Fort Worth? With this kind of expectations, hopefully we will be seeing the recent trend of home value escalation continue into the foreseeable future. I think it is safe to say that North Fort Worth is a great place to invest in real estate right now. A ten year buy and hold rental property you purchase today could see double digit gains before you decide unload the property in the next decade. It is a great time to buy, sell or invest in real estate in the Alliance Corridor. As a reminder, here is my coverage area.
October Inventory of Homes
Despite inventory being higher across North Texas, we are still seeing a major shortage of available housing in the Alliance Corridor. When I wrote about this last year, we had 2.2 months of inventory available on the market. It has since dropped another 14% to 1.9 months. What does this mean? Inventory measures how long it would take (in months) for the current homes for sale to sell out if no other homes are placed on the market. We real estate experts tell everyone that 6 months supply is a healthy market. With it being 1.9, we have a ways to go before we will see a healthy market. For sellers, this is good news if you are selling to move somewhere else. You will most likely have a lot of foot traffic come see your home and will see offers come in. For buyers, you will need to be aggressive in your offers as you will most likely face other buyers competing for the property. There is some good news on the horizon as many home builders are picking up production of new homes, but we are still only going to see about half the number of homes that are needed to be built. It is a great time to sell! Let’s chat if you are even remotely thinking about it.
October Median Days on the Market
I am starting to see many homes stay on the market longer, but even now, most homes are selling much faster than this time last year. It went from 36 days to sell to 15 days to sell, a 58 percent decrease in the number of days. In the summer, I was lucky to have a good property stay on the market past the weekend(if it was listed on Thursday or Friday). At least now, buyers have some time to breath and consider options. Why do some homes go so quickly? In this tight market, if you have taken care of your home, present it well by cleaning your floors and putting on a fresh coat of paint, and price it right, you chances of selling your home increases dramatically. Pricing it correctly is the most important consideration as you speak to your real estate agent. If you overprice a property, the market will reject the price and you will see very little attention paid to your home. The last thing you want in this market is to have your home sit on the market for two or three months. Most buyers will begin to question after a couple of weeks. What is wrong with this house? Why is it not selling? When you meet with agents, have them bring you a Comparative Market Analysis, which will show you comparable homes that have sold in the last three months and ones that are currently on the market. It should serve as a good guide for pricing your home. If you price it too low, you will most likely have a bidding war on your hands.
October Median Sales Price
With this statistic, we are finally starting to see some leveling off of sales price. It still did increase 2 percent from this time last year to just under $200K. For my coverage of area, however, it being at this level is amazing, considering where we were two years ago when the price was $175K. You can begin to understand why some real estate investors are very interested in this part of Texas. Homes are escalating at rates that show promise for longer term investments. As I mentioned earlier, if we do become the Silicon Valley of North Texas, I am hoping we emulate the one in California, where homes bought in the 70s have seen sales prices go above a million dollars. Will it ever get this high in North Texas? I doubt it, but the trends are encouraging for some major escalation over the next ten years. Homes are in short supply. We get big companies coming to Alliance all the time (Facebook!) and more than 30K people move to the area annually. Home builders can’t keep up with the demand and the jobs being created pay handsomely. It could very well be that we are on our way to achieving that vision of that UNT Professor.
In conclusion, real estate in Fort Worth continues to be a seller’s market, where people are selling their homes very quickly at some nice prices. Buyers are having to be aggressive on their offers and be quick on the draw in making them. Home builders are building as fast as they can, but we are still seeing some major shortfalls in available housing now and in 2016.