Lately, the homes for sale in Dallas stay on the market a little longer. Little by little, sellers are lowering their price expectations, and Dallas home buyers are getting deals.
Homes in Dallas stayed on the market, on average, for 37 days in April 2024. That’s up 8% compared to last year. Some (about 12%) have lingered on the market longer than three months.
Not only in Dallas but also in Austin and Houston, today’s sellers have to negotiate and really work with buyers. That said, homes that aren’t moving in these cities tend to be the pricey ones. Those priced under $300K continue to attract buyers.
Be Careful What You Ask For? So Much Inventory…
Texas builders are busy producing homes for a boom that’s already winding down. In some places, it’s nearly ground to a halt. One RedfinTM agent called last year’s Dallas home market “by far the slowest market I’ve seen in my 20 years as a real estate agent.” And still, construction abounds.
Nearly 5,000 listings hit the Dallas market in April 2024 — a remarkable 15% rise over the previous month. No wonder prices have softened. And the more builders keep building, the lower the listing prices go.
Texas as a whole, Reventure CEO Nick Gerli recently told Newsweek, “is starting to become a buyer’s market.”
What’s a buyer’s market? One test is whether a market has four or five months of housing supply available. Less inventory than that, and we’re in a seller’s market.
Across the country, there’s only about three months’ worth of inventory. The Texas market is a welcome contrast for buyers. And this should be the case for a while. Nick Gerli says Texas buyers can expect even better deals as 2024 unfolds. That’s because so many building permits have been issued.
Download Texas real estate deed forms from Deeds.com.
Hopeful Sellers Are Still Waiting in the Wings.
Buying from the already-existing housing stock is more challenging. Many homeowners would rather keep accumulating home equity than sell. Some would like to sell, but the Federal Reserve is keeping interest rates higher for longer than expected. And these owners would like to see the Federal Reserve lower interest rates before they sell, so they can buy again without paying today’s high (~7%) mortgage rate.
In other words, we can expect to see a flow of older homes as well as new builds on the market if rate cuts come later in 2024.
This brings up practically everybody’s frustration with mortgage rates. It’s understandable that the federal government doesn’t want to make borrowing easier; that could stimulate inflation. But the lack of rate cuts certainly isn’t helping the housing inflation issue!
Inflation has many aspects, including rising home prices, and rising costs of producing homes.
Real Estate Inflation Is Still Real—And for Most, It’s a Monthly Issue.
Meanwhile, in most places not named Dallas, home prices have risen. And the average interest rate on the popular 30-year fixed mortgage? That’s up there, too. It’s above 7% as of early May.
The old-timers say 7% isn’t so much. They remember mortgage rates at their all-time high of 14.7% — double what they are now.
But homes cost a lot more than they did back then. Try dealing with 7% on the price of a home today. Today’s near-all-time-high home prices, coupled with the cost of borrowing for a home, are pushing monthly housing bills to extremes. The median house payment is up 15% since last year and it’s approaching $3,000.
It’s obvious why buyers might ask where home prices are rising the least. According to Redfinas of May 2024, the three metro areas where prices went up the least are all in Texas. Dallas came in with the lowest of all rises: zero%. The Fort Worth, Austin, and San Antonio markets have also cooled off.
Texas Deed Law Has Changed Lately. Buyers, Take Note:
We want to remind readers of several new provisions in the law related to Texas deed transfers:
- Senate Bill 1612 went into effect January 1, 2024. It states that the fee for recording documents is now $25 for the first page, and $4 for each additional page.
- Texas law now points to the trustee as the party with the legal authority to act on behalf of the trust. This clarifies who holds that vital role when trust property is transferred.
- The Texas Estates Code has recently been updated. It provides new guidance for the handling of transfers from community property when one spouse dies, and outlines responsibilities of the surviving spouse. It also clarifies the role of affidavits of heirship in determining who inherits a home in situations where the owner never wrote a will or probate was not carried out. And it relaxes the notary requirements for the personal representatives of estates.
- House Bill 1547 took effect on September 1, 2023. It relates to the manner of distributing a home and other property, by revamping reimbursements between divorcing parties.
We’ve pointed out that these are major changes in the laws on deed recording and probating a home. Readers with fact-specific questions should consult with a family law, estates, or real estate attorney admitted to the Texas Bar.
Buying in Texas in 2024? Sounds Like a Plan.
Granted, mortgage rates are not easy to deal with these days. But in desirable pockets of Texas, right where there used to be bidding wars, real estate price action has calmed. Sellers aren’t moving quite so fast these days. And they are letting homes go for less than the listing prices. Hopeful buyers, take note.
Maybe the best summary comes from Chen Zhao, Redfin’s economic research lead. Zhao acknowledged the huge challenges home buyers face today, and then added:
But for serious house hunters who can afford today’s mortgage rates and find a home they love, jumping on it now isn’t a bad idea, given the fact that inventory is low and costs aren’t dropping anytime soon.
And there we have it.
Please note that this article is for your general awareness only. Markets are changing quickly. For situation-specific financial or legal advice, consult a licensed professional.
Supporting References
Giulia Carbonaro for Newsweek Digital via Newsweek.com: Texas Homeowners Are Struggling to Sell Their Houses (Apr. 8, 2024; citing an analysis of home listings by AgentStory.com).
Rocket Homes Real Estate LLC via RocketHomes.com (citing data from the Multiple Listing Service of the Houston REALTORS® Information Service, Inc.): April 2024 Dallas Housing Market Report (Dallas County, Texas; Apr. 2024).
Dana Anderson for Redfin Real Estate News: Housing Market Update – For the First Time in Nearly 2 Years, There’s No Major American Metro Where Home Prices Are Falling (May 2, 2024; based on statistics from the Mortgage Bankers Association and Redfin’s Homebuyer Demand Index).
Lily Katz for Redfin Real Estate News: Home Prices Stagnate in Florida and Texas as Supply Soars (Apr. 25, 2024).
Mortgage News Daily statistics.
Deeds.com: Texas Real Estate Deed Recording Fees and Estates Code Updates (Jan. 11, 2024; internal citations omitted).
And as linked.
More on Texas real estate: General updates, Texas “dirty deeds” ID law, WFAA Channel 8 investigates dirty deeds in Texas
Photo credits: Mang9 via Wikimedia Commons (CC-BY SA 3.0 unported); and Terrance Barksdale, via Pexels/Canva.