The Dallas-Fort Worth area has long been a thriving housing market and it looks like it’s continuing to grow. While demand surges, home values in the DFW metro are experiencing a boost while area homeowners are seeing average returns of 33 percent.
The latest data from Standard and Poor’s CoreLogic Case-Shiller national home price report supports the area’s reputation as a robust market. According to the report, the DFW market registered the third-biggest year-over-year increase in February, rising 8.8 percent, behind only Seattle (12.2 percent) and Portland (9.7 percent).
Across the nation, the S&P Case Shiller home price index, which looks at 20 metro areas, increased 5.8 percent as more home buyers vied for fewer available properties. This was the largest increase in 32 months. With these strong price gains and slightly higher mortgage rates, demand may eventually cool down; however, sales of both new and existing homes remain strong and are likely to continue through the summer. In May, sales of existing homes reached their highest level in a decade.
Dallas-Fort Worth Sellers See Record Returns
Also wroth noting, homeowners in the DFW area who are interested in selling their homes soon could see record returns. According to a report from the Dallas Business Journal, Dallas-Fort Worth homeowners made an average return of $57,000 during a seven year period, the highest return ever recorded in North Texas. This return also outpaces the current average for the United States.
“For Dallas, this stands out even more because we have data that goes back to 2000 and this is higher than the last building boom,” Daren Blomquist, senior vice president of ATTOM Data Solutions, told the Dallas Business Journal. “It’s the most profitable time to be a home seller in Dallas with a 33 percent return on the original price of the home over about seven years. Dallas has hist a new all-time home price peak in the third quarter of last year and I suspect we’ll see another all-time median home price peak in the spring or summer this year as well.”
What Does This Mean For Texas Home Buyers?
The idea of higher home prices and rising mortgage rates may not make potential buyers very optimistic about affordability in Texas real estate, but if you are considering buying a home in Texas — or even in the Dallas-Fort Worth area — you may be surprised to find out that there are still some great options out there. First time buyers and those on a smaller buying budget may have fewer properties to choose from, but that doesn’t mean there’s nothing available. The key is to BE PREPARED. If you’re a home buyer in Texas, you should do the following to ensure that, when you do find your dream home, you’ll be able to stand up against the competition and make a strong offer!
Work with a great mortgage lender and get pre-approved with them. Having a pre-approval letter in hand makes you a stronger buyer and shows sellers that you’re serious. (Talk to us today about getting pre-approved and receive a free rate quote).
Check your credit score ahead of time and fix any errors. There’s nothing worse than finding a home you absolutely love, spending time viewing it and applying for financing, and then finding out your less-than-perfect credit score could make the whole deal fall through – especially if it was due to an error on your report!
Work with a great real estate who knows the market. Good real estate agents are worth their weight in gold, especially here in Texas where markets can be very competitive and interested buyers have to act fast.
Don’t be dismayed if you don’t have a lot of cash for a down payment. Many potential buyers give up before they even really start trying because they assume they don’t have enough cash saved for a down payment. The truth is, for most loans, you only need 20% down if you do not want to pay private mortgage insurance (PMI). You can get a conventional loan with less than 20% of the purchase price in some cases; you’ll just have to pay a little extra for PMI until you accumulate 20% equity in your home. Once your home has 20% equity, the PMI can be cancelled. Also, there are low and zero money down government loans you may be eligible for: FHA, USDA and VA mortgages are three options that allow little to no money down.
Ready to work with a dedicated Texas mortgage professional? Reach out to us today for a free consultation and rate quote: (972) 591-3097