Home Buyers Got Half of What They Wanted in August 2019

PLANO, Texas — The Collin County Association of Realtors (CCAR) reports that as interest rates continued to drop in August 2019, homes sales continues to rise—creating a good news/bad news situation for buyers.

The bad news: Limited inventory for buyers.

August 2019 had 8.5% more listings under contract and 13.1% more projected closed sales than August 2018. Yet, there were 3.3% fewer new listings in August 2019 than 2018.

A combination that resulted in -0.7% less inventory for home buyers in August 2019 when compared to the year prior. In addition, it further solidified the current seller’s market, with only 3.4 months supply of homes. A market is considered balanced with six months of inventory.

The good news: The decreased inventory did not result in increased home prices.

On average, after of 50 days on the market, buyers and sellers agreed on a purchase price that was 95.9% of the original listing price in August 2019, resulting in a median sales price of $315,500. A median sales price that, while 1.8% more than the median sales price received in August 2018, continued a decline that began July 2019.

The change in median sales price paired with favorable lending conditions produced a housing affordability index of 113—8.7% higher than August 2018. Indicating that in August 2019, the median household income was 113% of what is necessary to qualify for a median-priced home under prevailing interest rates.

Overall, August’s market data tells an interesting story. Depending on which data point you look at, it is truly a great time to be a seller, or a great time to be a buyer.

Collin County Job Growth Secures a Seller’s Market

PLANO, Texas — The Collin County Association of Realtors (CCAR) reports that while some real estate markets across Texas are approaching a plateau, Collin County is not one of them.

In April 2019, the CCAR Pulse area had 16.3% more projected closed sales than April 2018; continuing a three-month trend of month-over-month increases of projected closed sales. A trend that began in January 2019 with 2,528 projected closed sales and nearly doubling to 5,002 in April 2019.

The percent of original list price received by sellers also continued an upward climb that began in February 2019—resulting in sellers receiving 96.5% of their original list price. Contributing to a 3.6% increase in the median sales price from the year prior ($320,000 vs. $309,000).

While April 2019 exhibited favorable selling conditions, buyers experienced positive buying conditions. Healthy buying power was demonstrated by a 105 housing affordability index, as well as a 22% increase in inventory from April 2018.

This inventory is reflective of the traditional spring increase of new listings. However, April 2019 outperformed the previous spring with 3.5% more new listings compared to April 2018 (7,167 vs. 6,923). Homes also remained on the market 52 days in April 2019—up 23.8% compared to the same time last year, however the lowest Days on Market for the CCAR Pulse area since October 2018.

Correspondingly, the months supply of homes for sale increased in April 2019 compared to the year prior—resulting in 3.2 months of inventory. While a notable increase from the year prior, an insignificant change from the market performance throughout 2019. Signifying a steady seller’s market. A market is considered balanced when there is a 6 months’ supply of homes.

What does this mean for buyers and sellers? It means Collin County residents chose right. Collin County is growing, and will continue to grow as more companies move headquarters to the area and jobs are created. This provides sellers with a steady influx of buyers, while at the same time, providing buyers with steady jobs and increased earning ability—setting them up to buy when they are ready.

March Home Sales Provided a “Happily Ever After” for Both Buyers and Sellers in 2019

PLANO, Texas — The Collin County Association of Realtors (CCAR) reports that buyers and sellers hit their stride in March 2019, resulting in more projected closed sales, fewer days on the market, and an increase in percent of original listing price received.

In March 2019, there were 4.9% more new listings than March 2018 and 25.2% more inventory of homes for sale than the year prior.

Homebuyers were ready to purchase the increased inventory, resulting in 4.5% more listings under contract than March 2018, 6.9% more projected closed sales than March 2018, and the fewest days on market (60) for the CCAR Pulse area since November 2018.

The increase in sales may be in part to the housing affordability index of 106 in March 2019; signifying that the median household income is 106% of what is necessary to qualify for the median-priced home under prevailing interest rates.  The index may have been boasted by a 1.1% decrease in the median sales price of homes in March 2019 ($313,854) compared to March 2018 ($317,500).

However, the decrease in median sales price should not discourage sellers. When compared to February 2019 ($300,000), the median sales price increased a significant 4.4% in one month’s time, continuing a two-month trend of month-over-month median sales price increase.

Sellers also received 96% of their original list price in March 2019, continuing a three-month upward trend of original list price received. An indication of well-informed sellers setting competitive prices, an additional factor contributing to increased projected closed sales in March 2019 and decreased days on the market.

The months supply of homes for sale is one data figure that continues to remain steady for the CCAR Pulse area. March 2019 reported 3.1 months supply of homes for sale—the median months of homes for sale for the past 11 months. This represents a steady sellers’ market, despite increased inventory and slowing of sales prices.

“Spring is historically thought of as the peak season for real estate and the March market performance in Collin County has indicated this year will not be the exception,” remarked David Alan Cox, CCAR President.

As sellers prepare their homes for the market and buyers qualify for their home loans this spring, signs indicate a happy ending for all parties involved.

Winter’s Chilly Sales Pace Is Beginning to Warm Up

PLANO, Texas — The Collin County Association of Realtors (CCAR) reports that while the Collin County real estate market has had a slow winter, the promise of spring began to force its way through in February.

“Both buyers and sellers experienced positive outcomes in February. Sellers enjoyed solid offers from well qualified buyers, and buyers enjoyed more inventory than previous months,” reports David Alan Cox, CCAR President.

Indeed the February stats agree. In February 2019 there were 7.4% more new listings than February 2018, 29.4% more inventory of homes for sale than the year prior, and 2.6% more listings under contract than February 2018.

February 2019 also presented stats that are initially concerning for sellers when compared to 2018, but promising when examined next to January 2019. For instance, there was a 0.0% increase in the median sales price in February 2019 ($300,500) compared to February 2018 ($300,441). However, when compared to January 2019 ($289,450), the median sales price has increased a significant 3.7% in one month’s time.

The percentage of original listing price received in February 2019 decreased 1.2% compared to February 2018. Yet, remarkably, February 2019 was the first month since May 2018 that the percentage has increased from the month prior, with 0.8% more of the original listing price received in February 2019 than January 2019.

Homes also remained on the market 25.5% longer than the year prior for a total of 64 days. This is not an alarming increase when compared to January 2019, when homes remained on the market for 63 days.

Similarly, the months supply of homes for sale increased 38.1% from February 2018, resulting in 2.9 months of inventory of homes in February 2019. A large change from one year ago, but only a slight change from January 2019, which experienced 2.8 months supply of homes.

With such a positive experience for both buyers and sellers in February, many are hopeful that the winter chill is thawing and the real estate market will be warming up.

Sellers More Negotiable on Price: Imperative Buyers Hire Agents Equipped to Handle Changing Market

PLANO, Texas — The Collin County Association of Realtors (CCAR) reports that sellers were more motivated to sell and negotiate in December than the area has experienced since 2013. On average, sellers accepted 5.1% less than their original listing price in December 2018.

Despite sellers’ willingness to negotiate on sales price, accompanying stats indicate Collin County remains a seller’s market. A market is considered balanced when there is six months of housing supply; Collin County reverted below three months of supply to 2.7 in December.

Additionally, sellers continue to enjoy increased returns on their investment, as median sales prices continue to rise. The median sales price in December was $309,907, a 2.5% increase from $302,375 reported in December 2017.

However, the good news is not limited to home sellers. The Housing Affordability Index increased to 105 in December, signifying that the median household income is 105 percent of what is necessary to qualify for the median-priced home under prevailing interest rates. This is a surprising rebound after two months of record breaking low index numbers.

Home buyers not only found themselves more financially qualified to buy a home in December, they had more to choose from. December 2018 had 26.1% more inventory than the year prior, with 10,763 properties actively on the market at the close of the month. This is a result of an increase in new listings (+3.5%), a decrease in listings under contract (-4.5%), and an increase in days that homes remained on the market (+15.4%).

David Alan Cox, CCAR President, emphasizes the crucial role real estate professionals have in this unusual climate. “We are starting off the year in a unique situation. We have more homes on the market, highly qualified buyers, and sellers who a more motivated to negotiate than we have seen in over five years,” notes Cox. “Clients are depending heavily on the expertise of their agent during their transactions. Now, more than ever, it is imperative buyers and sellers are represented by a Realtor who is educated on market values, engaged with their clients’ wants and needs, and ready to negotiate and protect their clients’ best interest.”

Collin Country CCAR Pulse Stats

Collin County’s Real Estate Market Hits Several New Milestones in May

Collin County real estate continued to build momentum in May, setting records for new listings, listings under contract, and median sales price. Data from the Collin County Association of Realtors (CCAR) is indicative of the busy housing market that has witnessed a significant boost in the past few years.

“DFW, in general, is in a strong seller’s market right now,” says Jonna Fernandez, CCAR Chief Operating Officer. “The boom in the Collin County real estate market can be attributed to many things, including the companies and corporations that have chosen to relocate here, the great school districts, employment opportunities, and much more.”

A record-breaking 6,919 homes were listed during the month of May. This was a 17.6 percent increase from May of last year, making it the highest number of new listings ever recorded in a single month. Year-to-date, new listings are up 8.1 percent.

Median home prices also experienced a surge, rising to $319,678—11.1 percent higher than in May 2016. This is the highest median sales price ever recorded in CCAR history. The intense interest in Collin County can be credited to the area’s growth.

The number of listings under contract also increased 6.4 percent last month, as compared to May 2016. This is the highest number of listings under contract ever recorded in a single month.

 Year-to-date, projected closed sales are up 12.6 percent, with no signs of slowing down as an influx of new residents and a spike in new home construction are expected. Fernandez said this offers an optimistic outlook for Realtors and their clients.

“There are no guarantees in real estate; however, we see the rest of the year definitely continuing with the seller’s market we have now,” she says. “May through August are always strong months for real estate, as most people plan their moves to occur during this time of year. While the end of the year may not necessarily be record-breaking as compared to the summer months, it will still remain stronger than what we’ve seen in years past.”

Millennials, Baby Boomers Impact Housing Market

For those either anxious to seek out their starter home or anticipate their final move as they embark on their retirement years, the topic of home ownership is imperative for the two largest generations: Millennials and Baby Boomers. Since the two account for the largest population segments in the United States, it comes as no surprise then that the two also have the greatest impact on the housing market.

Generally categorized as individuals born between 1980-1995, Millennials seem to have a unique view of the world and their living situation. “Many reports show that Millennials tend to live with their parents during and after their college years,” said Melissa Hailey, CCAR President-Elect and owner of North Texas Top Team. “This generation is still finding out how expensive it is in the ‘real world.’” Hailey said Millennials oftentimes have to consider which takes precedence: Having their own place or continuing the lifestyle they are accustomed to, which places a value on acquiring the hottest new technology, dining out frequently, and shopping on a regular basis­.

“Many times, they find that living with family is a more affordable option–or maybe the only option–to continue that lifestyle,” she said. “However, my children are in this generation, and none of them are living at home with us…yet.”

In decades past, there was a stigma associated with being an adult who still lived with his or her parents. Today, however, this is common for 20- and 30-somethings. In a 2014 Pew Research Center census data report, it stated that “for the first time in more than 130 years, 18- to 34-year-olds in the U.S. were more likely to be living in their parents’ home than with a spouse or partner in their own household.”

Some experts have alluded to debt caused by the cost of rising college tuition as one possible reason behind this growing phenomenon. Others cite the lack of high-paying jobs, the cost of living, and the lack of affordable housing.

Although the percentage of Millennials who opt to stay with their parents has increased significantly, other Millennials have found ways to make home ownership both possible and affordable. “I believe that Millennials are open to other housing options,” Hailey said. “Those could include renting long-term, roommates, tiny houses, condos, and multi-generational housing.”

For Baby Boomers, their concern is not primarily focused on the cost of homes. Rather, they seek homes that adapt to the challenges of aging. Baby Boomers usually elect to transition from larger to smaller homes as they generally look to down-size their living arrangements.

“The catch is that many of them want the upgrades and updates that they are accustomed to in their current homes,” Hailey said. “Our market definitely has room for building upscale, smaller, single-story homes for this generation.”

According to the National Association of Home Builders, Baby Boomers, individuals born between 1946-1964, want a variety of options that suite their more active and sophisticated lifestyles. These include home offices for second careers or part-time work, wider doors and hallways for wheelchair accessibility, bigger windows and better lighting, and low-maintenance exteriors and landscaping.

While some Baby Boomers consider townhomes as an option, others prefer a single-level residence to accommodate their long-term living plan. “They are concerned with aging in place and while stairs may not be an issue today, it could pose problems in their future,” Hailey said.

A Seller’s Delight: Demand for Housing Incite Competitive Buyers

For CCAR Chief Operating Officer Steve Haid, rising home prices and the scarcity of inventory strengthens the current seller’s market. Coupled with increases in mortgage interest rates, buyers are most affected. “Agents who work mostly with buyers will want to make sure buyers are prequalified or preapproved and prepared to write an offer on the home they choose,” he said.

Although it cannot be said of all major cities, the Dallas-Fort Worth metroplex has witnessed a strong seller’s market since 2011. This presents a great opportunity for sellers to not only sell their homes quickly, but to maximize their investments as well.

“It follows the basic economic principles of supply and demand,” Haid said. “When demand is high and supply is low, prices increase.”

Collin County is a perfect example of this. In 2008, houses were on the market an average of 100 days. In 2012, houses spent typically 61 days on the market. Fast forward to 2016, and the days on the market dwindled to 34.

Melissa Hailey, CCAR President-Elect and owner of North Texas Top Team, attributes a portion of the supply-and-demand imbalance to growth and economic development. “Houston and Dallas-Fort Worth led the nation in the number of single-family permits issued,” she said. “Job growth continues, and new construction building is continuing strong.”

Mortgage Rates Hit Highest Level in Years and Continues to Soar in 2017

Since early November, several hikes to the mortgage rates took place. Financial experts expect them to continue to surge in 2017. According to a November report released by the Real Estate Center at Texas A & M University, “the Federal Home Loan Mortgage Corporation ticked up 30 basis points to a 3.77 percent average rate on a 30-year-fixed-rate mortgage, while the ten-year U.S. Treasury bond yield edged up to 2.14 percent from 1.76 the month prior.” In December, the interest rate increased by .25%.

“The rate increase indicates that the U.S. economy may be on a rebound, and consumers and businesses can afford to pay more to borrow money.”

– Melissa Hailey, CCAR President -Elect and owner  and REALTOR® of North Texas Top Team

While it is predicted that up to three additional hikes totaling up to 1.25% will take place within the year, CCAR Chief Operating Officer Steve Haid said the overall outlook remains optimistic.Despite these small interest rate hike projections, mortgage rates are very low in comparison to other times in our history, such as the 1980s,” he said.

Melissa Hailey, CCAR President -Elect and owner of North Texas Top Team, advices REALTORS® to become knowledgeable about interest rates and how the changes affect their consumers’ decisions to purchase a home. “With the possibility of rates continuing to rise, first-time home buyers looking for more affordable housing may want to consider buying now before rates increase and home sale prices rise any further,” she said.


Top 3 Real Estate Trends of 2017

Like most milestones, purchasing a house is an exciting time in one’s life. Along with the anticipation of settling into a new home, feelings of uncertainty and anxiety are common. For those looking to purchase a home this year, here are three notable changes that will impact your decision.

  1. Mortgage interest rates are expected to steadily increase over the next year. Due to several hikes that began in late 2016, mortgage rates are the highest they have been in two years.
  2. It is a competitive seller’s market. The demand for houses surpasses the supply, limiting the amount of available houses.
  3. Home prices will continue to rise. When one couples the reduction of available homes with the growth and economic development of the Dallas-Fort Worth area, the result is an inflation of the median sales price.