DALLAS — The supply of houses in the Dallas area has sunk from bad to worse for buyers, with market inventory decreasing by more than half year over year.
The decrease of 53.3% locally in January is more than three times the national average decrease of 2.3%, according to a new report from Compass real estate brokerage.
The extreme shortage has exacerbated the seller’s market, causing the number of offers received to shoot through the roof, said EA Stribling-Kivlan, senior managing director for Compass (NYSE: COMP).
“In the Dallas market, Compass agents have noted that it is not uncommon for a property to receive upwards of 50 offers, many cash, with full appraisal waivers, quick closing schedules, and no option period,” Stribling-Kivlan said.
Compass’ report is based on data from the North Texas Real Estate Information Systems’ Multiple Listing Service for single-family homes in Dallas County.
There were 1,649 homes on the market in Dallas County at the end of January compared to 3,533 in January 2021.
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The Dallas-area median home sales price has inched closer to the national average of $350,300, with a 16.2% increase in January 2022 compared to January 2021, coming in at $315,000.
The number of homes sold dropped 8.6% in the same period to 1,561 sales in January from 1,707 in the first month of last year.
Sellers in the Dallas area are getting the price they’re requesting. Homes sold in January for 100.1% of their list price, compared with 97.4% of asking price in January 2021.
The median number of days on the market dropped 35.7% in Dallas in the same period, from 42 days in January 2021 to 27 days in the initial month of this year.
Chris Kelly, president and CEO of the Ebby Halliday Cos. based in Dallas, said he’s seen this movie before.
“It’s a little bit of dèjá vu from last year,” Kelly said. “Housing conditions really haven't changed much from 2021. We're still seeing a lot of migration into the state, which is producing a super-high level of demand versus the supply that's out there. We're still seeing that double-digit price appreciation year over year through these first two months of the year.”
Rising mortgage rates could temper some of the speculative demand in the market and begin to ease some of the issues caused by the shortage, he said.
“We're going to still have high demand versus supply, but if it would ease back a little bit, we can get back to a little bit of norms where people can take a breath if they have to decide if it's the house that they want and not just blink like they do right now,” Kelly said.
Stribling-Kivlan said the larger number of home sales nationally in January was likely prompted by the anticipation of increasing mortgage rates.
The median price for existing homes nationally rose 15.4% year over year in January to $350,300, proving to be another record month and marking the 119th month in a row of year-over-year gains, she said.
“It is astonishing to witness how very little there is to purchase, coupled with buyers looking to scoop up what remains to try and lock in lower mortgage rates,” Stribling-Kivlan said.
First-time home buyers have continued to remain reserved in the market nationally, accounting for 27% of buyers in January 2022, down from 30% in January 2021, the Compass report found.
In contrast to first-time home buyers, individual investors and second-home buyers continue to increase their presence in the market, accounting for 22% of January 2022 home sales, increasing from 17% in December 2021 and 15% in January 2021.
Cash is king, according to the report, with 27% of all home sales in January 2022 all-cash, compared to 23% in December 2021 and 19% in January 2021 — also demonstrating the continued interest from individual investors and second-home buyers.
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