By Nancy Pieper
Where is the housing market going next year? Fundamental data all points to a continuation in the rise of housing prices in 2022.
The pandemic has left an indelible mark on our home buying mentality as well. As many make a permanent shift to working from home, there will be a continued emphasis on a great home office setup, and home entertainment (both indoors and out). High speed internet access also is a MUST have, and some older neighborhoods may not have the best option. Home builders are starting to incorporate all these factors into their floor plans. When you think about it, the new normal is also being able to live anywhere you want, and this opens up many possibilities that were not a consideration in the past.
Regarding the new construction market, historically less than 20% of buyers have been willing to consider new homes. But this percentage has jumped to greater than 45%, in part driven by the dwindling supply of existing homes available for sale on the open market in the North Texas area.
Another major factor is buyers are exhausted running around putting in offers, only to be either out bid or competing with cash offers, which makes new construction even more enticing.
Given rising lumber prices, and rising costs of practically all other items needed in the construction process, single family new builds are up as much as 16 points from a year ago. But remember: There can be as much as a 50 percent greater energy cost saving in a WELL BUILT new home vs. an existing home. (Depending on what year it was built)
The Dallas/Fort Worth area had approximately 650,000 people move into our area in the last five years. Like many other parts of our country, this area is “on fire” due to a number of reasons: relatively low housing prices compared to other parts of the U.S, above average job market, lower than average tax rates (no state income tax), and a great airport with the additional advantage of C.S.T. zone for large companies doing business with both coasts.
Low interest rates have pushed the numbers upward in our market for buyers in all price ranges. However, this looks to change as the Federal Reserve Chairman has indicated their willingness to raise rates to help curb inflation.
A normal inventory for a normal market is 6 months. The DFW market averages running at 1.5 months’ supply, and with some areas as low as a 0.4 months’ supply, the result is the market today shows inventory at the lowest we have seen in decades.
If you are considering buying a home, this market is not going to “wilt,” so do not wait for a bargain as it will not happen in 2022!
Nancy Pieper was a Flower Mound resident for 30 years and currently resides in Lantana. A Realtor for close to a decade, she is a a 1% top producing real estate agent in the DFW Metroplex. Learn more about her here.