Interest rates dropped 9 basis points to an average of 3.69% with .5% in fees and points.
The Mortgage Bankers Association is forecasting purchase originations will increase 1.6 percent in 2020. Their Chief Economist, Mike Fratantoni, believes we will see one more interest rate cut before the end of the year. He also predicts geopolitical uncertainty and a continued slowdown in the global economy will continue through next year and slow U.S. economic growth. This will keep interest rates low into next year, encouraging buyers to purchase.
Source: MBA Press Release
In The News
Economic uncertainty is one of the factors that plays into the strength of the housing market. When people are unsure of what will happen in the economy, they pump the brakes on home purchases. The tariff dispute with China has created a lot of economic tension for quite a while. Some speculate this has kept home buyers at bay. However, news released yesterday said that the U.S. and Chinese negotiators have agreed in principle to roll back tariffs in simultaneous stages if their trade talks advance.
If the tariff dispute is coming to an amicable conclusion, it’s possible the economy will strengthen and get some buyers back into the purchasing pool.
Last week Freddie Mac released their Forecast with the heading, “Housing Market Remains Strong While Economic Slowdown Looms” Freddie Mac’s Chief Economist, Sam Khater said, “The housing market remains on solid ground with housing starts, building permits, existing home sales, and new home sales all outperforming the broader economy.” The forecast predicts housing prices to increase 2.8 percent in 2020.
The latest Case-Shiller U.S. National Home Price Index was released last week and increased 21 basis points to a level of 212.06. The Dallas Home Price Index increased .04% to an index level of 192.63. For the last twelve months, Dallas has seen an increase of 2.77% in the total value of existing single-family housing supply.
DFW October Market Stats
The average sales price is up 5.7% from October of last year to $315,673.
The average price per square foot is $138, an increase of 4.5% from last year.
The average days on market has increased to 52 days on the market. It has been on the rise since June of this year when homes averaged 45 days on the market.
Sellers have to negotiate an average of 4.6% off their asking price to get to closing. On a $300,000, that would mean a reduction of $13,800 from the list price.
There are 3.3 months of inventory on the market. Still well below what is considered a balanced market of 6 months.
The total number of homes for sale in the entire MLS is at 31,865 homes. That number has been on the decline since June. Traditionally inventory does decrease in the fall and winter months, so I expect this number to keep going down.
If you’ve listened to the podcast for a few weeks, you’re probably starting to see a pattern on this takeaway: we’re still in a seller’s market. Projections for next year are all looking relatively positive. No boom, no bust, just steady.
If you like hearing these stats and want more detailed data on your neighborhood, head over to CrestEdgeRealEstate.com/neighborhoods.
If you’re looking to buy or sell real estate in DFW, let’s talk. Contact us