Bryan - College Station September Market Stats:



Bryan Specifics



College Station Specifics

Interesting comment on raw land. Are you talking about residential lots in suburban areas or like 1-15 acre type tracts in the Fulshear, Bellville type areas?

More like residential development type lots.

Red Pear Realty said:

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HOUSTON

• This is another month of Buyers believing that they should get a 50% price cut because interest rates are WAY UP, and Sellers not caring. I don't think prices in Houston are really going to adjust until we start losing jobs in a big way and sellers can no longer say "well if I don't hit my number, then I'll just hold it (vacant) or rent it".
• I made several offers this last week--some accepted, some not. It does feel like the luxury and first time home buyer markets are the hottest.
• Don't get discouraged--deals can still be had. I had one client this last month get $50,000+ off a home listed in the $450,000 range. This was a special situation for the seller, but these are still possible!
• We got blown out of the water on a bid on a luxury home in Houston. 6 bids. All cash offers. Went for six figures over asking price.
• Went under contract about two weeks ago with Meritage Homes with a client for a new build. Meritage is now offering something like 10-15% off their completed homes, 5% commissions, and $5,000 Commission bonuses in order to get deals signed. Oh, and they will also help you buy down your rate to the mid 4% range if you go with their lender. This is pretty typical of builders doing what they can to move homes in this market.
• Days on Market increased from 2.5 to 2.7 month over month. Remember that 6 months of inventory is still equilibrium, so we are still very much in a sellers market.
• Average sales price is UP while Median sales price is DOWN month over month, but year over year, prices increased SIGNIFICANTLY

Here is my prediction for the next few years:

• Rates (at roughly 7.5% today) continue to climb for the foreseeable future.
• Eventually the job market collapses--prices will not adjust until this happens.
• Rent rates continue to climb as builders stop building, and sellers reduce new for sale listings and rent instead.
• When the real estate market finally does adjust, there will be three tiers of homes. These are my predictions:
• Tier 1 real estate values will fall 0%. Think homes with good schools in good locations like River Oaks, Memorial, etc.
• Tier 2 homes will fall 8-10%. Think OTL homes in areas without good school districts. This would be homes in areas like North Spring Branch.
• Tier 3 real estate will fall ~30%. For these, I'm thinking stuff like raw land, homes in poor quality neighborhoods with bad schools and locations, etc. Think dirt anywhere. Kashmere Gardens, 5th Ward, etc.

Quote:

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Consumers kept the high end of the Houston housing market humming in September even as the market collectively continued transitioning to more normal, pre-pandemic levels. Sales overall were off for a sixth consecutive month due largely to the persistent lack of inventory and inflationary headwinds that include rising interest rates. However, the inventory landscape is showing signs of improvement for consumers as an uptick in new listings helped boost overall supply to its highest level in two years.

According to the Houston Association of Realtors' (HAR) September 2022 Market Update, single-family home sales fell 17.0 percent, with 7,664 units sold compared to 9,235 in September 2021. On a year-to-date basis, the market now trails 2021's record-setting volume by 5.1 percent.

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https://www.har.com/content/department/newsroom?pid=1879

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Where do homes in master planned suburban communities (greatwood, sienna, etc.) fall in your prediction?

Post-Covid it's hard to tell but my thought would be somewhere between 0% and -10%. In the great financial crisis prices fell over the course of two years and had fully recovered in another two. Back to par.

Great updates. I was definitely starting to get nervous after reading some of your posts over the summer. We listed our Plano house at the beginning of the month and thankfully went under contract several days later with an offer that was a tad over list price but with a little bit of seller credit that evens it out. I think Collin County is not yet slowing down as much as other counties which worked out in our favor.

How is north west Montgomery county looking?

San Antonio Area September '22 Housing Data

• Continued increase in inventory, now at 3.2 months
• Price/sqft staying consistent with previous months' data ($188)
• 40% increase in avg Days on Market (42)
• Nearly 22% decrease in number of sales compared to August

New Braunfels



Spring Branch / Hill Country



Gonzales County





https://sabor.com/Market-Research-and-Statistics/Market-Statistics/San-Antonio-Area-Market-Report
https://fourriversrealtors.com/top-members-resources/market-viewer-infographics

What in the wild world of sports is going on in North Dallas? Never seen this much inventory on the market in my life. And it just keeps growing. Do sellers not realize what the market is doing? Are all of these people going to market because they are desperate for money?

We pulled our house from the market because almost literally nothing is moving in our price range in our area. And, yet, more and more houses keep entering the market and then quickly decrease price. It's unreal.

Any of you trying to buy a house should have all the leverage in the world unless all of these sellers still think the market is 6 months ago for some stupid reason.

I get those scenarios but the amount of inventory that continues to come on the market with little to no chance of selling at anyones preferred price is mind boggling..

We've tracked a basket of ~25 homes for about two months now and none of them have sold. Several have gone into Pending or Under Contract only to return to the market a few days later. Almost all have taken reductions some more than $100k and still sitting there.

And now we are seeing a glut of homes dump onto the market in the last couple of weeks. It's as if no one has a clue that nothing is moving. I hope most of these people aren't desperate for the money.

YouBet said:

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I get those scenarios but the amount of inventory that continues to come on the market with little to no chance of selling at anyones preferred price is mind boggling..

We've tracked a basket of ~25 homes for about two months now and none of them have sold. Several have gone into Pending or Under Contract only to return to the market a few days later. Almost all have taken reductions some more than $100k and still sitting there.

And now we are seeing a glut of homes dump onto the market in the last couple of weeks. It's as if no one has a clue that nothing is moving. I hope most of these people aren't desperate for the money.

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Of the basket of 25 homes your tracking:

• How many of them were sold in the last 24 months and this is a resale?
• Is there a way to predict how many have variable rate loans?

This could answer some of your worry about needing money.

If people are beginning to get out of homes they really could not afford, with their payments now rising, while the valuations are decreasing could be quite a nasty spiral.....for many.

To answer your bullets:

- I believe one.

- No idea but good point. Maybe a lot of these people did variable rate loans like you suggest.

Talked to a banker buddy this morning who works nearby and he agreed that the number of homes flooding the market right now is almost inexplicable.

Seems to be a combination of people desperate to unload a variable loan(?), delusional people who are unaware of market realities, people sitting on a paid for house who are fishing for cash. Other?

Obviously each neighborhood may be different from the published data above, but on the average, it's pretty accurate. With that said, here are some thoughts on your comments:

1. We've had such low inventory numbers for so long that "normal" inventory numbers might seem like the market is flooded. For the last two to three years, many Texas sub markets have had inventory levels as low as 0.3 months. Remember that 6 months is considered equilibrium, so if we've been at 0.3, we'd need TWENTY times the amount of homes on the market just to be a fair market between buyers and sellers.

2. We are not in the same market we were in 6-24 months ago. During that time, I saw sellers mistreat buyers in so many ways, and it didn't matter, because buyers had no other options. Now the pendulum has started to swing back the other direction (I'm not saying it's a buyers market) and many sellers and their agents have not realized that the market has shifted. I saw a house the other day with dead roaches all over the kitchen and living room floor, and dried dog poop just hanging out in the laundry room. This type of behavior, while never SHOULD have been acceptable, might have not killed a listing 6-24 months ago, but it DEFINITELY will today. Can you imagine leaving dead roaches and dried dog poop around the floor of your listing of your half a million dollar house? Sellers thought this type of behavior was acceptable for so long that they are having trouble acclimating back to "normal" again.

3. Buyers are tired of the beat down. The posters on this forum are not the normal…we are well qualified, have good income, good credit, and can be selective. But at a certain point, buyer fatigue sets in. It's not about the math or interest rates, it's about buyers being tired of stepping over dog crap when they go see a nice home, and then having a seller tell them they need to offer over asking price on a home that's been on the market a year because now they have multiple offers.

4. 55% of homes are owned free and clear of debt. About 1/3 of offers are made all cash. Let that sink in.

5. Real estate is local and every house is unique. Your neighborhood may very well perform differently than a submarket and the overall market. I submitted four offers last week or so. As an example, we got one bid accepted for greater than $100k off asking price. That was fun. Haven't had anything like that in a long time (if ever). But had another offer recently in a nearby neighborhood get completely blown out of the water when we offered full price, all cash.

6. I'm not going to mention any names, but last week out of the blue, I received an email from an acquisitions director with an iBuyer who I was under contract with this summer (never seen his name before), asking where their earnest money was. Their deal died this summer. I have not heard from them since we parted ways. All relevant paperwork was provided to them as of July 8, and the title company (who they demanded to work with) returned their Earnest Money on July 11. People don't ask about money like this unless money is tight. Trouble in paradise at this globally recognized investment firm?

Red Pear Realty said:

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Obviously each neighborhood may be different from the published data above, but on the average, it's pretty accurate. With that said, here are some thoughts on your comments:

1. We've had such low inventory numbers for so long that "normal" inventory numbers might seem like the market is flooded. For the last two to three years, many Texas sub markets have had inventory levels as low as 0.3 months. Remember that 6 months is considered equilibrium, so if we've been at 0.3, we'd need TWENTY times the amount of homes on the market just to be a fair market between buyers and sellers.

2. We are not in the same market we were in 6-24 months ago. During that time, I saw sellers mistreat buyers in so many ways, and it didn't matter, because buyers had no other options. Now the pendulum has started to swing back the other direction (I'm not saying it's a buyers market) and many sellers and their agents have not realized that the market has shifted. I saw a house the other day with dead roaches all over the kitchen and living room floor, and dried dog poop just hanging out in the laundry room. This type of behavior, while never SHOULD have been acceptable, might have not killed a listing 6-24 months ago, but it DEFINITELY will today. Can you imagine leaving dead roaches and dried dog poop around the floor of your listing of your half a million dollar house? Sellers thought this type of behavior was acceptable for so long that they are having trouble acclimating back to "normal" again.

3. Buyers are tired of the beat down. The posters on this forum are not the normal…we are well qualified, have good income, good credit, and can be selective. But at a certain point, buyer fatigue sets in. It's not about the math or interest rates, it's about buyers being tired of stepping over dog crap when they go see a nice home, and then having a seller tell them they need to offer over asking price on a home that's been on the market a year because now they have multiple offers.

4. 55% of homes are owned free and clear of debt. About 1/3 of offers are made all cash. Let that sink in.

5. Real estate is local and every house is unique. Your neighborhood may very well perform differently than a submarket and the overall market. I submitted four offers last week or so. As an example, we got one bid accepted for greater than $100k off asking price. That was fun. Haven't had anything like that in a long time (if ever). But had another offer recently in a nearby neighborhood get completely blown out of the water when we offered full price, all cash.

6. I'm not going to mention any names, but last week out of the blue, I received an email from an acquisitions director with an iBuyer who I was under contract with this summer (never seen his name before), asking where their earnest money was. Their deal died this summer. I have not heard from them since we parted ways. All relevant paperwork was provided to them as of July 8, and the title company (who they demanded to work with) returned their Earnest Money on July 11. People don't ask about money like this unless money is tight. Trouble in paradise at this globally recognized investment firm?

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Very good points.

On #1 and previous posts it looks like were already half way there with inventory at 3 months. My family is and has been a beat down buyer. I am basically an idiot for not buying mini ranch pre-covid because I thought price per acre was $500 too high. Could not convince my spouse to sell our ten acres in very HOT market (6 months ago but still very warm now) and move into RV for 6-12 months then buy. We are waiting another few months but also realize were losing value in our current owned place with the goal that where we are going values are declining at a much faster rate than our current home (6A to 2A ISD).

I am also convinced blue state/city invasion of Texas or red areas of TX, especially certain areas or neighborhoods as you say have really inflated the values. This has leveled off quite a bit but I think it is still buffering our decline somewhat. Your stats on 55% of homes debt free and 1/3 cash offers I am assuming represents Texas or your market area in TX. If this is the case do you think a majority of the cash offers are from folks moving from CA or the like? If one had the time to test this theory you could look at trends in states where people are not moving to.

just curious do you have any info on midland county or know where i could find some similar data?

GT_Aggie2015 said:

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How is north west Montgomery county looking?

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Bump

GT_Aggie2015 said:

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GT_Aggie2015 said:

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How is north west Montgomery county looking?

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Bump

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Sorry about that! Please see below.

Thanks!

JAG03 said:

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just curious do you have any info on midland county or know where i could find some similar data?

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Got it!

Red Pear Realty said:

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JAG03 said:

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just curious do you have any info on midland county or know where i could find some similar data?

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Got it!

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thanks!

Where are your ten acres? !