The year 2017 continued the recent housing market history of concerns with rising prices and affordability. Sellers continued to benefit and buyers became more particular as available inventory increased as the year moved on. D-FW area home prices are at record levels as we have been one of the hottest housing markets in the country over the last five years. Yes the market is strong, but definitely the demand and focus is homes priced under $400K and especially $300K and under. Through November 2017, the North Texas market was at $300K median price sold and $365K for average price sold! Without question, the market needs more entry-level homes. The issue is that North Texas pre-owned housing prices rose 10 percent in 2016 and 9 percent higher in 2015. An estimated 5 percent increase this year still means that North Texas home prices are more than 40% higher than before the recession a decade ago.
As we head into 2018, here are some thoughts from housing analysts and experts from across the country.
- Most economists anticipate and are predicting slower home market pricing gain in the North Texas area. The number I am hearing the most is at or around 5%.
- You can expect that the inventory on higher-end homes will continue to increase as the demand is substantially less.
- Home affordability will continue as a major concern and especially for first-time homebuyers and young families. The reality is that home prices have grown at a much faster pace than annual wage increases.
- New home construction will continue to be an intriguing option for those buyers that can afford them. New home builders have lots of inventory on the ground and there are great deals due to both price reductions and special promotions.
- With overall housing inventory about ten percent higher than last year, NOW is a good opportunity for buyers.
- If you are thinking of selling, many sellers reach out to real estate agents in mid-January and February as they want to be prepared when the amount of buyer activity picks up in March and continues through August or September.
As I stated earlier, most analysts, economists and housing experts are forecasting that 2018 will still be a good year as demand will continue as 80,000-100,000 move into the North Texas area next year due to job growth opportunities. The increase in home prices and sales will be slower in 2018, but a modest increase is still expected.
Source: NTREIS, The Dallas Morning News
Steve Lester, REALTOR® is with Keller Williams Realty living in Allen, Texas.