While the real estate market in Collin County remained strong during the month of July, it began showing early signs of stabilizing after a year of record-breaking sales.
According to data from the latest Collin County Association of Realtors (CCAR) Pulse report, three areas that are beginning to show signs of a balancing market include new listings, inventory of homes for sale, and days on market. New listings increased 4.8 percent in July compared to last year, and the supply of available homes rose 13.5 percent from July 2016. In addition, the average number of days a home was on the market last month was up 6.7 percent to 32 days.
“Seeing the amount of new listings increase in July, coupled with inventory going up, could mean that the Collin County area is very slowly making its way to a balanced housing market, which is a good thing,” says Jonna Fernandez, CCAR Chief Operating Officer. “Six months of inventory is considered a balanced market. At the beginning of this year, our inventory was only at 1.8 months—an extremely strong seller’s market. Seeing the supply of homes at 2.7 months for July is encouraging.”
Although the housing market may be showing some very early signs of stabilizing, there are still many indicators of our years-long seller’s market. Median sales price is up 8.5 percent to $305,000, which has also impacted how much home buyers can afford. Currently, the median household income is 113 percent of what is necessary to qualify for a median-priced home under prevailing interest rates. This is a 10.3 percent reduction in housing affordability from last year, when household income was 126 percent of what was needed.
“It is no surprise that we see the housing affordability index has decreased in the past year, given the strong seller’s market that we’ve experienced” notes Fernandez. “When you have multiple offer situations, homes often sell for more than their list price, thereby increasing the median sales prices of homes over time. An increase in home prices, means that a potential buyer with a median household income is finding it more difficult to find a median-priced home.”