Fort Worth homes are selling despite COVID, and buyers are paying a lot more for them
Homes are still selling like hotcakes in the Fort Worth area despite the pandemic, and buyers are paying a steep price.
Home sales are expected to increase more than 11% in 2021, and sales prices are expected to rise 4.4% during that time, according to the listing site Realtor.com.
The median sales price of a home in Tarrant County was $265,000 in November, up from $247,900 during the same month last year, according to Realtor.com, which is operated by News Corp. under license by the National Association of Realtors.
“We have seen prices just go through the roof. The buyers know it, and the sellers know it,” said Crystal Zschirnt, a Redfin principal agent who represents buyers and sellers in far north Fort Worth, Haslet, Southlake and other neighborhoods.
Zschirnt says that on a typical year about 90% of her clients are seeking to buy an existing home. But this year, most of this clients are looking at buying new homes, because the prices of existing homes are just too high. Many prospective sellers of existing home are setting prices far above market value, she said, because they know that some buyers face a shortage of available housing and may be forced to pay extra.
Many prospective buyers find themselves in a bidding war with a handful of other buyers. Others, she said, are turning to the newer homes begin built in suburban areas such as the Berkshire development in far north Fort Worth.
“I have 10 under contract, and they’re all new-builds except for one. It’s usually the opposite,” she said. “Buyers are kind of tired of being beaten out (by other buyers) and being asked to go up on their offer by thousands of dollars, so we are walking into new-builds.”
The pandemic slowed home sales during the spring, when the COVID shutdown forced many businesses to close and prospective sellers were afraid to let strangers into their homes. But since then, home sales have been strong nationwide.
Many buyers are thinking long-term and proceeding with their plans to move into a new home, often because of a job change that requires a relocation, said George Ratiu, a senior economist at Realtor.com. In many cases, they view the pandemic as a temporary problem that shouldn’t affect their housing decisions.
The pandemic has prompted real estate agents to rely more on virtual tools such as online 3D home tours and virtual document-signing, but otherwise hasn’t slowed the public’s appetite for residential real estate.
“The Dallas-Fort Worth Metroplex is benefiting from an extremely solid and well-diversified economy,” Ratiu said in a phone interview. “The Dallas metro along with just a handful of other cities across the country is probably one of the closest cities that has a microcosm of industries closest to the national economy — with manufacturing, energy, financial centers. It’s really that economic strength that is what’s driving the real estate markets.”
Of those who bought homes in Tarrant County during the past year, 48.5% were from within the county, 34% were from elsewhere in Texas and 17% were from out of state, Ratiu said.
Finding affordable housing is still an issue for many people who would like to buy homes, including many Millennials who want to buy their first house, said Daryl Fairweather, Redfin chief economist. But, even though housing prices have skyrocketed as much as 60% since 2014 in Fort Worth, the area is still more affordable than cities in other states such as California, Illinois and New York, she said.
“Many people are going to be moving to Fort Worth because it’s still affordable,” Fairweather said. “One thing about the pandemic, it has normalized remote work, and people will be able to move away from the office where land is more affordable.”
The number of homes in forebearance is a bit of a concern, Ratiu and Fairweather said in separate interviews. Forebearance is when a homeowner has been temporarily allowed to stop making loan payments, usually because of a hardship such as job loss.
In Fort Worth, about 2% of homeowners say they feel likely or somewhat likely to be foreclosed upon in the next few months.
But Ratiu and Fairweather said they aren’t overly worried about large numbers of homeowners losing their homes. The difference between today’s economic challenges and the Great Depression of more than a decade ago is that today homeowners have far more equity in their homes.
As a result, they said, homeowners who can’t afford their mortgage payments could probably sell their home to get out of financial trouble, and re-enter the market with a home at a lower price point.
More than 3.3 million Americans are expected to face foreclosure once their forebearance period ends, according to a Redfin study. But many of those owners will be able to refinance their mortgage, or sell their home for more than they owe.
This story was originally published December 10, 2020 at 5:30 AM.
