Everything has changed in real estate over the past 3 months. So how have the rising interest rates affected Allen, Texas?
The GREEN LINE is the number of sales in each price range. Most sales are happening at the 400k to 600k range. That makes sense, as the majority of homes are in that price range. But let's go one step further... How long did it take for those sellers to find buyers?
The BLUE LINE is the Cumulative Days On Market, or CDOM. It's great to see that all these homes were sold, but that doesn't tell how long it took for these sales to happen. In a healthy market, the CDOM needs to be in the 15-30 day range.
Let's break down what's happening in Allen price ranges.
The 16 or so sales took over 30 days to sell (on average). This is more about the condition of the properties than the number of buyers willing to purchase in this price range. The majority of these homes were NOT MOVE-IN READY. So negotiations have to happen in order to find the right price/true value for each of these homes. Plenty of buyer demand here from investors and regular folks alike. It's a HEALTHY price range.
Same number of sales as the previous price range but sold in fewer days. This is where the cheapest move-in ready homes can be found in the marketplace. Averaging around 21 days on market, this is the hottest price range. But the problem is that it's not all that hot. Higher interest rates have caused this to be as good as it gets for sellers. If selling for more than 400k, you will have to hire an amazing real estate guide to avoid losing money. : ) It's a HEALTHY price range.
About 45 homes sold in around 27 days on market (average). Do you want to know what happens to homes after 2 weeks on the market? They realize that they have to drop their price to attract a buyer. That is what is happening here. Buyers have the leverage and sellers are willing to sweeten the deal in many ways beyond a discount. Did you know that sellers are allowed to pay money towards reducing your interest rate? This and MORE are on the table for negotiation to get you to buy their home. I would love to talk with you more about how to make these negotiations work for you. This price range? It's a BUYER'S Market.
Buyers have all the leverage. In this price range, it takes well over a month to sell a home (on average). The only homes sold WITHOUT HUGE DISCOUNTS are the beautiful properties that win the beauty contest among available homes on the market. Truly amazing homes are immune from high-interest rates and crazy markets. In a red hot market, they sell for list price plus 5-15% so at least buyers now have a chance to own these dream homes for an honest price. For the REST of the homes out there, it's a battle to capture a buyer. It's a SUPER BUYER'S Market.
Advice for Sellers:
All of this is temporary. Right now there are more homes for sale than there are buyers. If you are a seller above 400k, count on selling at a 5% discount or more unless you have a truly exemplary home to sell. It only takes three buyers to establish real estate values in a neighborhood. So look around at the homes being sold around you. These are your greatest indicators as to whether your values will stay steady or lose value incrementally. The problem is that most sellers are in scramble mode to find a buyer, so they betray others' homes values to quickly cash out. If you must sell, let's talk about options to convert the home to a rental until interest rates lower. There is a wise decision to be made here, so let's review all of your options to avoid having regrets. IF you have to sell, there are some hidden strategies for attracting buyers to your home that most other sellers (or their agents) have no clue about (hint: it's what attracts people to buy a new home).
Advice for Buyers:
Temporarily, you have the leverage. It may not last quite as long as most reporters of "doom and gloom" are reporting (about a recession in 2023). While I may not know the immediate economic future, I do know that the Texas economy and our real estate values are surprisingly strong in the middle of the market, where most buyers/sellers meet to do business. This is the 300k to 500k range. For the moment, the number of buyers in the market has reduced so much that there are too many homes available. This means that buyers are getting discounts, interest rate reductions, upgrades and much more than they would otherwise. As your real estate guide, I would love to answer your toughest questions about how to proceed and give you a customized, step-by-step plan to finally have the home of your dreams.
In as little as 15 minutes, you can get answers to your real questions...
Thank you for taking the time to read through this real estate guide for homes in the city of Allen, Texas. Use this info to get a general idea of what's going on over the past 90 days, and reach out to me at timothy@timothyhenley to start talking specifics related to you buying or selling a home. Great info is more valuable than gold or silver, and will free you up to see the next steps towards living your new life. Whatever that looks like!
Your Real Estate Guide for Life,
PS... Here is a link to my PREVIOUS report on Allen home values. Published in August, it shows the roller coaster that each of these price ranges have been through.