I was out working in one of my new home developments today.
As I chatted with the sales staff about how things were going, a common theme became apparent. Potential buyers are sitting on the fence waiting on home prices and interest rates to drop further!
This has been fueled by the reports of nationwide home price drops by many of the national media outlets. The old adage,”location, location, location” comes to mind. All real estate is local!
I did an interview locally last week when this news was released discussing the local numbers. Dallas Fort Worth is actually bucking the national trend with average sales prices up 3.2 percent in North Texas and 5.4 percent in Collin County. Prices are not going down here.
I looked deeper into the numbers and found that new listings are down 17 percent while sales volume is down only 14 percent. What these numbers indicate is that the market is absorbing inventory at a rate greater than new inventory is coming on the market. The supply of available homes is getting smaller. This helps keep prices stable or rising.
To be fair, values may continue to drop in other places depending on a number of factors. Contact a local real estate professional to find out what’s going on in your area.
Mortgage interest rates are at 50 year lows. They may fluctuate slightly but I don’t see them trending much lower. The only reason they remain so low today is because the government is buying most of the mortgage paper and holding the rates low. Eventually the government is going to want to push this back into the private sector but the private sector is not going to get back into mortgage backed securities until rates climb.
What does all this mean for Dallas Fort Worth home buyers? Now may be one of the best times to purchase a home. Prices are stable in most areas and we’re seeing an upward trend over the past year. Mortgage interest rates are at 50-year lows.
It’s time for home buyers in DFW to get off the fence.
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