Real Estate Market Thaws: Activity Ramps Up After Almost a Year of Freeze

What that means is a couple of things…

First and foremost, it is more apparent than ever that prices must come down for people to be able to afford to buy, especially with interest rates increasing the way they were over the past year. Some people will say that it was purely the interest rates falling slightly that caused activity to pick up.

But I say, first and foremost the price has to come down. And it did in December/January. Then, that’s when we saw an infusion of activity in the market (more people buying and selling), and we saw a little moderation in the interest rates around that same time when they decreased to that 6% level at the end of January. And that’s when we really saw a big infusion of transactions beginning to come in – both here at our firm and in the market in general.

But the thing is, it’s really just more normalized transaction activity — even though we’re calling it a big infusion.  

It is actually still pretty slow as far as transaction activity goes overall. But still, activity did increase and pick up from what it had been the previous 11 months. Prices came down, interest rates came down, and that finally gave some relief to buyers, so the activity increased.

And also, sellers are now getting okay with the “new, new.”

They are ready to make that upgrade or that downsize now. Because people just aren’t going to sit in their home forever. We are discontent by human nature, and eventually we get used to the current environment and then that’s when we make our move.

Even when it doesn’t make sense, we still make that move after a certain amount of time passes. Some people might be thinking, “Well I have an interest rate of 3 to 4% on my current home, so why would I move and have to have a 6-7 percent interest rate?”

But even then, we still do it. Because ultimately, we’re humans and we have our ways.

So, between all of those things coming together, that’s what has pushed us up in number of transactions finally over the past couple of months.

We also saw the median price come up last month for D-FW by 1%. The prices have really just flattened out year over year lately in the area.

But still remaining, there is a persistent problem which will not get us back to normal transactions anytime in the near future. And that problem is, we are in one of the top three markets in the nation.

We have businesses coming here, day after day, relocating their headquarters here – moving here from all over the nation. And, putting jobs here. So, what that means, is people are coming here – and that in this environment where things are frozen up, we will continue to see a lack of inventory.

We did not see listings increase these past couple of months… So, effectively, what we saw was a big infusion of buyers come in and then it pushed inventory back down and so prices came back up just a little bit. I believe that we’ll see this type of bouncing back and forth throughout the year. The activity is going to just come in waves based on that cycle.

But the fundamental thing is that we have an unemployment rate below 4%. We don’t have enough people for the jobs here basically. So, demand is here.

We are not in a 2008-2009 market, we’re in a market that has strong demand. So, if you want to sell and make a move, the ultimate truth comes down to the fact that it is all about pricing it right.

You price it right, at 1% appreciation, and we still see multiple offers and homes go under contract within a week on the market… The demand is fundamentally there if you hit that price right.

So, if you’re sitting there trying to sell your home and not getting any activity, I will tell you with confidence that it is definitely the price.

If you lower the price to the market, the market will come and see you — and it works every time. It might not be what you want to hear, but it is the truth. And then, you can make that move that you want to make. And then remember, too, that on the buy side, you’re also getting to pay market price, which is nice.

Now, I’m going to give you a county by county breakdown of some of the biggest stats and indicators for the housing market in Rockwall, Kaufman, Hunt and Dallas Counties.