Over the past few months, we’ve seen a steady increase in new sellers coming on the market, resulting in an increase in inventory. These trends have continued through the month of July, so to change things up, let’s take a closer look at what reality looks like for both buyers and sellers in today's market, and some tips for winning on both sides of the transaction.
As we’ve mentioned in our previous market updates, 2021 has presented its fair share of challenges for buyers. Record low inventory, sharp increases in prices, and heavy competition have created a tough path to home ownership for many buyers here in Dallas-Fort Worth.
The recent increases in inventory offer promise for those revisiting or starting their search, yet there are a few realities that many buyers will still have to address:
- In the past year, home prices in North Texas have increased by a whopping 22%, and continue to do so. This increase is especially impactful to first time home buyers, who can’t offset the price increase by selling their current home.
- Inventory is on the rise, yet remains 42% lower than a year ago. While the increase is welcomed, we have a ways to go to get back to pre-pandemic inventory levels.
- Decreasing lumber costs may not translate — in the short term — to increased affordability for buyers searching for new construction. Many builders continue to face shortages of other building materials and skilled labor, continuing to limit production and keeping costs high.
Given these realities, how can buyers win in today’s market? Here are a few tips:
- Keep an eye out for homes that are sitting on the market. Given the pace of this year’s market, many buyers are focusing heavily on new listings, making these homes more likely to slip under the radar. With sellers testing higher price points, the reason a property sits on the market may not mean something is wrong with the house.
- Set a budget that offers flexibility. Consider looking at homes slightly under the top of your budget to allow yourself room to compete should you need to.
- Choose an agent that will give you an edge. Winning in this market is not a one size fits all strategy. A great agent will work on your behalf to discover what’s most important to sellers and craft your offers to stand out.
Next, let’s talk about sellers. While increasing home values, low inventory, and high demand present a dream scenario on paper, let’s run through a few realities sellers still need to be aware of:
- The recent increase in inventory means you can’t fall in love with yesterday’s market conditions. Inventory remains low, yet your results in today’s market may not necessarily match what a neighbor experienced 2 or 3 months ago.
- Pricing well above market value may actually net you less money. Starting with a price that is far too high may limit the initial number of interested buyers, causing your property to sit on the market.
Here are a few ways sellers can win in today’s market:
- If you intend on using the proceeds from the sale of your current home to buy your next home, planning is essential. Work with your Realtor to create a plan that fits your preferred timeline and prevents you from having to move twice.
- Work with a Realtor you trust to arrive at an asking price that will net you top dollar. A great Realtor understands your local market and how to create a strategy that maximizes buyer interest.
- If you choose to list above market value, commit to making swift price adjustments to stay in front of potential buyers.
If you have any questions about the market or would like to create a game plan to buy or sell, our team is standing by to assist you!