A quick glimpse at the current market
Well, now there’s a new article on CityLab called “The Delicate Art Of Buying A Home In A Pandemic.” Much of this article is focused on New York City and Washington, DC -- which are entirely different real estate market beasts, and probably anyone landing on this post does not currently live there (I, the fair author, went to college in DC and grew up in NYC, and let’s say there is a reason I live in North Texas, and it’s highly tied to disposable income).
Here are some of the more general things (non-DC-specific) that this article can teach us, however:
Home prices fell in March, especially in western states: Here’s some of that data. This is important to DFW residents because a lot of our population surge from 2010-19 came from those western states. If economic conditions worsen in the west, or conversely if homes become dirt cheap, that could impact the culture of DFW for a decade.
Record-low interest rates are boosting mortgage applications: Here’s that data, which is good for the overall market, broadly speaking.
There’s a contrast, however: Mortgage lenders are going to tighten everything in the short-term, which means you will need immaculate credit (or close to it) to get a low-interest-rate dream home. And, per Gallup, only 1 in 2 Americans even think the current moment is a good time to buy a home. That’s the lowest home-buying confidence since the third and fourth quarter of 2006, which almost immediately preceded the 2008 housing crash.
The financial picture: This is logical and sad, but if you’ve been terminated, furloughed, etc… your first concern is probably not buying a home. It might be, but it’s likely not.
Meanwhile, what’s the average rent drop in DFW for April?
That would be … nine dollars. In 2008, rents fell 2.2% in DFW. So far in 2020, we’re at 0.8%. In April historically since 2015, rents had risen $6-9, so basically it’s a full reversal of an average year across the past five years. 85% of Texas renters made their April 1 rent, which was above the national average of 83%. Total net absorption of new apartments in March was 2,240 units -- in April it was 962 units. Net absorption was thus still positive, but the numbers were way down. April 2018 net absorption was 3,129 DFW units, so we’re way down from that period.
Are less people looking? Yes, overall. We haven’t seen a ton of that -- our phones and clients stay busy, which is good -- but there is a sense of stasis, or “riding out the worst of it.”
It all comes back to your individual situation
The numbers above are stats in the aggregate. Your situation, financially and geographically and more, will vary. If you want, we can walk you through everything we think we know in this moment -- because, admittedly, no one really knows everything. That’s universally true, of course, but in this moment it’s even more true.