Happy October! The last quarter of the year is my favorite as we celebrate my favorite holidays: Halloween, Thanksgiving and Christmas. I realize that many scrooges out there don’t like all the hype surrounding this time of the year. After all, stores are now putting out the holiday decorations in Mid-September. I am one of the ones that eat it all up. I love it!
You are reading this post to find out about three numbers for real estate in Fort Worth. If you are regular reader of my monthly post, you also know that I share some news stories that caught my eye. I try to make this post as informative as possible.
For our first news article this week, it comes from the fine people at the Fort Worth Star Telegram where they ask the question. Is Fort Worth becoming a suburb of Dallas? Your immediate response would be, “Of course not!” I wold agree, but I present some data from the article that might make you think otherwise.
From 2012-16, there were 934,000 workers in Tarrant County, according to the most recent Census American Community Survey results available. Of those, 146,360 workers commuted to Dallas County for their jobs, and an additional 8,100 commuted to neighboring Collin County.
In essence, we have about 16% of the workers in Tarrant county commuting to Dallas. Are you as surprised as I was? We also have checked off all the boxes for a suburb as well. We have expanded our residential real estate growth to accommodate the 20K people moving here annually. Our tax base is heavily residential versus commercial. We also simply do not have enough high paying jobs for people to live and work here. All characteristics of a suburb. Please make sure to read the article as City Fort Worth leaders are making strides in attracting more companies, but we still have a way to go before we are seeing more commercial property taxes than residential.
Our next post comes from my favorite real estate reporter, Steve Brown over at the Dallas Morning News. The article goes into detail about how our real estate prices are overheated. Fitch Ratings writes in their report that we are about 10% overpriced in the Dallas Fort Worth region. Fitch looks at the economic conditions of localities to come up with their estimates. To me, this is the same story, different year. Our sales price appreciation has slowed down this year to a crawl despite these dire warnings. I don’t see us being overheated at all, just a correction that is finally taking place in the local housing market.
My last article comes from a national magazine discussing the upcoming 2020 real estate market. They go into some details about the market itself, but I loved to read about the 2020 real estate trneds. You get your usual technology taking over the industry (every year!). You also get a nice write up on Co-living arrangements. They call it the “Golden Girls model” of living. In this model, unrelated individuals live together to cut costs and create a sense of community. Apparently, this is a huge trend with older individuals who need some help with daily living, but still active enough to function mostly on their own. Some other trends included hipsturbia, where the suburbs are working to copy the downtown concept of working and living in the same place. Extreme heat was also mentioned as ongoing trend. Real estate investment is moving away from areas directly impacted by climate change. The investors are flocking to more temperate areas.
Now onto the numbers! Here are three numbers about Fort Worth Real Estate to help you understand our market.
September Months Supply
Fort Worth Inventory actually went down slightly from 2018 to 2019. This year, we saw an inventory of 2.7 months while in 2018 we saw 2.8 months. In 2017, it was 2.4 months.
What this means for sellers: Inventory measures how long it would take the current supply of homes to sell out to the current buyers. Historically, six months has always been considered a balanced market. We have seen anything higher than 3 months in Fort Worth for years. Sellers need to keep this statistic in mind when deciding the right time to sell their home. Since we are still in a seller’s market here in Fort Worth, sellers will generally get their way so it is still a good time to get your house listed on the MLS.
What this means for buyers: Buyers are still facing an uphill battle when it comes to finding a property in Fort Worth. With the low mortgage interest rate, it is definitely a good time to attempt it. Buyers don’t have to worry about every property going multioffer any longer as the market is better than in the stressful times we saw a few years ago. However, if the house is priced correctly and shows well, buyers still need to accelerate their efforts to get out to see the home.
September Average Days on Market
The average days on market for Fort Worth went up from this time last year from 34 days to 41 days. It was 33 days in 2017.
What this means for sellers: Sellers are going to see more buyers over a longer period of time than we have seen in the past. A week might not seem much longer, but for a seller having to arrange for showings and keep their home looking spectacular, it can seem like a lifetime. Sellers need to be aware of the longer days on market so they set their expectations on how longer they have to keep their homes looking their best. One important aspect the seller must ensure is to price their home correctly as this is still the main reason a home doesn’t sell in any market.
What this means for buyers: Buyers might have some wiggle room in their negotiations with sellers about their offer terms. When a seller has seen their house on the market for any extended amount of time, they tend to get anxious about it selling at all. Buyers should work with their agent on making the offer when a house has been on the market for longer than the average days on market. Just be sure to keep in mind that sellers are used to getting what they want for their properties so you shouldn’t go below about 90 percent of asking in your offer.
September Average Sales Price
For the last two years in Fort Worth, the average sales price has appreciated around 3% from the year before. In 2017, we saw an average sales price of $245k while this year we saw $260K.
What this means for sellers: Sellers can rejoice that their homes are still gaining in value. We are not seeing the double digit percentage increases anymore, but we are still seeing prices increasing in value. Sellers should discuss with each other if they are willing to put the house on the market. Is this consistent 3% rise enough to convince you to list?
What this means for buyers: Buyers are not rejoicing as much but should be grateful that sales appreciation has slowed down quite a bit from its height. Still, if you are thinking about buying, this is a good time to do so since the sales prices are beginning to flatten out a bit in Fort Worth.