DFW Market Update: Q3 2017

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As the Dallas/Forth Worth Real Estate market continues to strengthen throughout the summer of 2017, our growing Team at Scott Neal Real Estate (SNRE) is currently on a record breaking path to help more families buy/sell their home this year than every other previous year in the company’s history!  We’d like to take a moment and express a huge thank you to all of our past and current clients who have entrusted our team’s services over the last 10 years!  It’s an honor to serve the Dallas Real Estate market and help people with one of the biggest decisions and transactions of their lives- buying or selling a home. 

With the DFW Realty market being one of the hottest in the country and receiving a lot of positive media attention, we are frequently asked what is going to happen in the next year or two.  Since prices have continued to significantly appreciate over the last five years, many people often assume that we are in a bubble and will experience depreciation when the market cools off.  This result remains to be seen but based on historical data in the DFW market, my prediction is that we will eventually level off to normal rates of appreciation.  However, the DFW & the North Texas areas continue to be a haven for stable job growth, population growth, good schools, and room for expansion (new neighborhood developments).  In fact, DFW is said to have anywhere between 300-400 people a day moving here and is one of the top ranked areas in the country for job creation.  

These variables in addition to inventory levels/supply-demand etc are all significant contributors to what we are experiencing today with Median Price, Days on Market, Sold Homes and Months of Inventory which we have broken down below.

Median Price:

Once again, the median price rose almost 11% over the last year to $238,000. This marks four to five years in a row where we have continued to experience double digit price appreciation across DFW.

Days on Market:

In addition to price, homeowners typically want to know how long will it take for them to sell their property. The average days on market to sell a home in DFW has continued to fall from 90 days in 2012 to 41 days in August 2017. So while homes are continuing to sell for a higher price, they are also selling in record time.

Sold Homes:

The real estate market has been in recovery since 2012. We went from selling approximately 70,000 residential units to selling over 110,000 units in 2017. Some of the most sensational news stories around the metroplex have been the influx of out-of-state relocations.  Some recent reports show that 300-400 new people are moving to North Texas every single day.  In fact, we speak with new people from all over the country on a daily basis who sign up on our website looking at properties and wanting to relocate to Dallas for work, family, change of environment, tax benefits, cost of living, weather, home prices in comparison to current situation, and many other reasons making DFW an ideal location for their next home destination.

Months of Inventory

The most important, key economic indicator that expert Real Estate Agents track closely is the level of homes for sale compared to how many homes have sold i.e. “Months of Inventory.” This is an excellent barometer to gauge the strength of the market.  Currently, DFW has the lowest level of inventory since the market peaked in 2007. 

However, home buyers can still take advantage of opportunities despite how hot the market is by aligning themselves with an expert who proactively stays on top of the market and has exclusive access to great opportunities through their years of experience & established network.  And of coarse, sellers are in prime position to capitalize due to everything we discussed above contributing to this “Seller’s Market.”  

If you have been thinking about buying or selling real estate anywhere in the DFW market, contact us today for a private consultation so that we can provide the best advice and options in preparation for your sale or purchase.  Also, our team has an established “Home Hunter System” providing access to exclusive “off market” opportunities through our extensive network in addition to our detailed cherry picking of homes from the MLS fitting your criteria.

What Does the New Year Hold for the DFW Marketplace?

According to the statistics, 2017 should be another great year for the DFW area marketplace. Is it better to be a buyer or seller, though?

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Happy New Year! I hope you had a great time with your family over the holidays. Now that 2017 is officially under way, I wanted help you get back into the swing of things with a few predictions on what to expect from the DFW marketplace this year based on what the numbers tell us. Before that, though, I just want to say thank you for your referrals and transactions. Our team had our best year ever last year. We sold tons of homes and handled more volume than ever, and it’s all thanks to you. Keep sending business our way, and we’ll keep taking care of you and yours. So, what’s been happening in the DFW marketplace lately? Ever since the spring of 2012, prices have been going up, and that trend is continuing. Currently, the average price for a residential home is about $275,000, which is up about 6.5% from this time last year. We’re not experiencing the same double-digit increases we did in the past few years, but we’re still seeing some very aggressive price appreciation. The number of properties that have sold over the past year is just under 110,000, which is up 4.3%. As you see, the number of sales are increasing along with the average home price. The average days on market is 42 days, but for our clients, that number is only 19.

The stats don’t lie—now is a great time to buy or sell.

Our list-to-sales price ratio currently stands at 97.2%. That means—on average—sellers are having to negotiate 2.8% off their original asking price. Even though you might be hearing that it’s an overwhelming seller’s market, buyers are still paying less than what sellers are initially asking. For our clients, the list-to-sales price ratio is 101%. Right now, we have about 2.6 months’ worth of inventory, which is down 10.3% over the last year. In light of these numbers, a lot of people have asked me lately if we’re in a real estate bubble. My answer is no, because there’s nothing on the horizon that we’re seeing that could spell doom and gloom for our marketplace. If you’re trying to maximize the gain out of your home sale and time the market, you need to pay attention to the level of inventory. The closer that number is to zero, the hotter the market is for you as a seller. As that number rises, though, the price appreciation we’ve been experiencing will slow down. My personal prediction is that we will continue to see growth in our marketplace in 2017. The stats don’t lie—now is still a great time to both buy and sell a home. For sellers, homes are worth more now than they’ve ever been, and there are more buyers in the market now than we’ve had over the last four years. For buyers, there are more properties on the market, yet inventory continues to stay low, and on top of everything else, interest rates are still very low. If you have any more questions about the DFW real estate market, give us a call, send us an email, or visit us online. Cheers to a very prosperous 2017, and we hope to hear from you soon!

How to Protect Yourself Against Wholesalers

It’s easy to let your home be sold for less than what it’s worth in a wholesale transaction, so today I want to talk about how you can avoid letting this happen to you.

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Today I want to talk about how to not let wholesalers sell your house for less than what it’s worth. In the real estate world, wholesaling is a very simple tactic that investors use. The way it works is the investor will approach the homeowner, offer them a certain price, put them under contract, and then immediately try and sell that property to another end user before they close on it. For example, let’s say an investor comes to you and says they’ll give you $200,000 for your property and you agree, even though it might not be what you wanted. The wholesaler then turns right around and markets that property for an increased price—maybe anywhere from $210,000 to $250,000, depending on what they think they can get. The way wholesalers make their money, you see, is through the difference in price between how much they offer you and how much they offer to sell it to somebody else. What’s the problem with this picture? First of all, these people do not represent you, and they typically aren’t licensed. If they are licensed, they have no fiduciary responsibility to you—the home seller—to get the most amount of money within the shortest amount of time with the least amount of hassle. Everything is designed to help them get the absolute best spread they can between the price they offer you and the price they get on the open market. Secondly, they typically don’t have the funds to actually close on the property if they can’t find another buyer. Oftentimes, they have zero intention of actually going through with the purchase if they can’t find another buyer. Third, they still have to find an end user, which isn’t guaranteed. These three drawbacks stand in stark contrast to what an actual real estate agent can do for you. How can you protect yourself from falling into one of these situations, then? There are four ways: In my experience, the typical homeowner doesn’t know the difference between someone who is going to actually buy their home and someone who is going to flip their contract like a wholesaler, so if you ever meet with someone like that, the first thing you want to do is ask, “Are you going to buy my home, or are you going to wholesale my home?” There are ways that you can verify this. If they say they are going to buy, then you want to see their name on the contract. If they’re a part of a company, you want to see that they have the ability to sign on behalf of that company.

If you’re ever approached by one of these people, please call us.

The second thing you can do is avoid signee contracts, which basically states in the buyer line that this person or company is going to purchase the contract...or whoever they assign it to. That’s a big red flag. The third thing you can do is verify their proof of funds or their ability to finance the property. If they say that they’re a cash buyer, you want to see a bank statement in their name or their company’s name with the amount of money that’s required to purchase that property. If they’re not getting funds from their bank, you’ll have to find out where they will get their money from. The fourth and last thing you can do to protect yourself is get a big earnest money deposit. To clarify, there’s nothing wrong with selling your house to an investor at a discounted wholesale price. There are plenty of people out there who buy properties and give the homeowners as much as they possibly can at wholesale prices. I happen to be one of them. There are also a lot of scammers out there, though, too, so you have to be careful. If you’re ever approached by one of these people and you want an opinion on what to do next, don’t hesitate give us a call. If you’re thinking about buying or selling a home, we’d also love it if you reached out to us. In any case, we’d be happy to help!