Welcome to my monthly post about the current state of real estate in Alliance Corridor and around the entire DFW area. Real Estate in Fort Worth continues to be strong. The biggest national news of interest was people sleeping outside in McKinney to buy a house in a new housing development. In late September/Early October, this news story made the rounds on the Internet. As you already know, the DFW area is one of the fastest growing areas in the country with job growth adding more than a 100,000 jobs a year. Builders have been having a difficult time keeping up, falling short on the number of houses being built with some predicting only half the amount necessary to keep up with the population growth. As you can imagine with supply and demand, prices have gone up in response to these extreme reactions. Demands feeds on itself. If one person wants it so much, others will start to want it as well.
Real estate in Fort Worth is no different. News outlets are reporting buyers are still finding it difficult to find homes with many having to put in several offers before landing a home. Homes are also going to multi-offer situations very quickly with many homes going for ten grand above asking. An offshoot of this problem is that appraisals are coming in too low. These multi-offer situations drive up pricing artificially and many appraisals will come much lower. I had one home appraised at seven thousand below the contract price, which was a good nine thousand above asking. The two parties, buyers and sellers, had to come together to determine a new contract price. This is a much more common occurrence today with real estate in Fort Worth than we have seen in recent times. Buyers and sellers should set their expectations appropriately that appraisals might cause further negotiation to take place after the initial option period has elapsed.
Investors are also still liking the DFW area for their business as many news agencies reported in October. DFW was ranked number one. The reasons mentioned are numerous, but many investors are beginning to look for secondary markets that have high job growth and corporate re-locations, which has happened quite often here in Fort Worth. I have investors from around the world approaching me about the prospects of investing here. With the tight inventory we are currently experiencing, it can be tough to start in the market, but I have seen many landlords taking advantage of the market and unload some of their rental properties. I advise investors that buy and holds are the best bet right now. Flips in a tight seller’s market are not being found easily on the MLS right now. Off market properties continue to be as hot as always.
Here is a picture of my main geographic area of coverage, but I will do business with anyone in the state of Texas and beyond. Let’s chat if you want to buy a home, sell a home or invest in real estate today.
September Inventory of Homes
This number keeps getting smaller month to month. We are now down to 2.0 on inventory in the Alliance corridor. As a reminder, this statistic shows how long it would take, in months, for the current inventory of homes to sell out. A healthy market is 6 where the number of homes on the market is balanced well with the number of buyers. We stand at 2.0 and have been below six for three years now. I have never seen the number this low. If you get your home on the market, you will be one of the few. Buyers should set their expectations accordingly as well.
September Median Days on the Market
As we enter into the winter season, we are seeing some houses continue to go very quickly. Many homes are still staying on the market for less than a week with the average being 14 days. As always, the most important part of marketing your home for sale is getting the price right. If you do this one thins, you increase your chances at selling your home at or better than the average rate for the area. Presentation is also key so paint your walls and clean your floors as way to convince buyers that your home is the one for them.
September Median Sales Price
With real estate in Fort Worth and surrounding areas, we are seeing prices continue to escalate 8 to 10 percent every month. A home for sale in this area for $180k last year can be seen on the market for $200K this year. The questions on every’s mind at this point are numerous. Can this upward tend be maintained? Will prices stay at the current level, or drop back down? Real estate is cyclical in nature so we will see some correction in the prices at some point in the future. However, I am beginning to think that prices might not come down as far as I might have said this time last month. Inventory continues to be low and with more people moving to the area, we might eventually see something that happened in other parts of the country where homes become overly expensive for a longer periods of time.