Recent news headlines might have you thinking the real estate market’s just limping along.

Home sales continue to fall and high mortgage rates are keeping buyers, and sellers, away.

But ask anyone that’s been out looking at homes recently and you might be surprised to learn that the perception doesn’t match the reality.

Would you be surprised to learn that multiple offers are still part of our resale market?

How about the fact that many new homebuilders are still working off of waitlists?

If you’ve been considering buying a home should you wait for mortgage rates to fall before doing so?

Is now a good time to sell?

I answer these questions and share the latest data regarding the Frisco and Prosper real estate markets in this month’s update.

I’m also going to share a tactic that will allow you to buy a home today with a 30-year fixed-rate mortgage that’s up to 2% lower than today’s prevailing rate

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Watch the following video, or continue reading below, to learn more;

Is the Housing Market Broken?

I did a deep dive into this question in a recent blog post, but the bottom line is the current real estate market is essentially frozen.

Despite higher mortgage rates, there are still plenty of people that are in the market to buy. The problem is there are simply not enough homes for sale to satisfy demand. That is why the total home sales number keeps falling.

You can’t sell what isn’t for sale.

In Frisco, there are 16.4% fewer homes for sale now than there were a year ago. Four years ago there were more than double the number of homes for sale than there are now.

Here’s a look at the change in the number of homes for sale in Frisco over the past 5 years;

It’s much the same story in Prosper;

Where is All the Inventory?

Falling inventory is the one variable that all the expert forecasters got wrong.

As mortgage rates rose, the assumption was the number of homes for sale would continue to rise as buyers pulled back.

That didn’t happen.

With the economy still strong, the vast majority of homeowners were selling because they wanted to, not because they had to.

71% of homeowners in the country have a mortgage rate below 4%. Trading that low mortgage rate for a new one at 7% made no sense. Sellers simply took their homes off the market.

The Future of Home Prices

Home prices are simply a reflection of the relationship between available supply and demand.

You might recall those predictions made at the end of 2022 about big home price declines in 2023 due to rising supply and falling demand, as explained above.

That obviously hasn’t happened.

Here’s a look at how those same experts have adjusted their home price forecasts;

As a matter of fact, according to the Home Price Expectation Survey (a survey of 100 top economists and industry experts that comes out quarterly) home prices are now forecast to continue increasing through 2027;

While these numbers are national, they are in line with forecasts that I have seen for our local Frisco and Prosper real estate market.

While neither Frisco nor Prosper have recovered all of the pricing gains lost in the fall of 2022, as of August, prices in Frisco are up 6.8% year-over-year and 2.4% in Prosper.

Is Now a Good Time to Consider Buying or Selling?

The truth is only you can make the decision that’s best for you and your family. Everyone’s situation is different.

My goal is simply to provide the information, and some insights, to help you make that decision.

For Buyers

The vast majority of home buyers I have spoken to recently are more focused on mortgage rates than home prices. That makes sense because mortgage rates move the needle more, in terms of payment, than home prices do.

A 1% decline in the mortgage rate has roughly the same impact as a 10% price decline.

As shown above, there are currently no forecasts predicting home price declines in the foreseeable future, let alone price declines of 10% or more.

So should you wait for mortgage rates to fall before buying?

That’s one option, but some of the money saved by the decline in mortgage rates will be offset by the expected increase in home prices.

What if you could get the best of both worlds?

Lock in today’s home prices and get a mortgage rate of up to 2% lower than the prevailing rate.

There’s a unique opportunity in the market right now to do just that. I recently helped a home buyer not only pay less than the list price but obtain a 30-year fixed-rate mortgage of 5.25%. Not a temporary rate buydown either, but for the life of the loan.

If you’d like additional information and want to learn how we can do the same for you, let’s talk! Schedule a Call and I’d be happy to explain how we did it.

For Sellers

Even though home prices are expected to continue increasing, now could be a great time to sell depending on why you are wanting to sell.

Home prices in Frisco over the past 5 years are up approximately 60%. You could be sitting on substantially more equity than you think. (CLICK HERE to see how much equity you have gained in your home)

If you have a larger home than you currently need, have a two-story and would prefer a smaller single-level, or maybe a condo, then there is a good possibility you could sell and either pay cash or have a substantial down payment for a smaller home, where the change in mortgage rate won’t necessarily make a big difference.

Alternatively, maybe you need more space. Based on the current activity level, and time of year, both resale sellers and new home builders, have shown more willingness to negotiate. Receiving concessions for buying down the mortgage rate, or making repairs, are quite common in today’s market.

As mortgage rates fall, more buyers will enter the market, while that will be good for sellers, it means the likelihood of negotiating the best possible deal on your next home purchase will become more difficult.

Bottom Line

Everyone’s situation is unique and different. Contrary to popular belief, the current real estate market here in Frisco and Prosper remains busy. I’m not suggesting things haven’t slowed down, because they have, but opportunity does exist for both buyers and sellers.

If you want to stay up to date on the latest trends in our local real estate market then I invite you to sign up for my weekly market report. Here is a link to the latest Frisco Market Report. Use the search feature at the top of the report to see the latest trends for the city or zip code of most interest to you.

If you have additional questions or a specific situation you would like to discuss in more detail, I invite you to Schedule a Call with me.