Rockwall Housing Market Update June 2022

It’s time to talk real estate and my vocabulary word for right now is “manic.” We’re seeing extreme changes based on every news headline. This month, we’re dealing with headlines about the bear stock market, another increase in the federal funds rate, and a cooling job market. It’s a trifecta of news that does not typically bode well for real estate.

This month, I want to talk about these big national headlines and how they’re affecting our local market. Now, before you keep reading, you have to promise me to read through the whole blog because if you stop after this first part, you might freak out and start telling everyone the bubble has burst. So you do need to read to the end because there are some good things happening. Do we have a deal?

Before we jump into the monthly numbers, let’s look at showing activity in Rockwall County. In the zip codes 75032 and 75087 for June 1st through June 14th, we have an average of less than seven showings per listing until you get to the sub $200,000 price point.

However, when I change our parameters to look at all of May,  we are seeing anywhere from 8-13 showings per listing depending on your price, with that sub $200,000 price point being the outlier with 19.5 showings per listing.

And to drive this point home even more, we can see that in April we had similar numbers with even more total showings.

For the first two weeks of June, we’ve had 744 total showings. In May we had 1,758 total showings, and in April we had 1,958 total showings. We are halfway through the month but not halfway to the number of showings from last month. We have more listings and fewer showings, so it only makes sense that houses sit a little longer before going under contract, and those crazy multiple offer days are slowing down. 

Here’s another thing I want to show you. Take a look at this search. Go to jshannon.kw.com/search and you can do a search for homes that have dropped their price in the last seven days. Look at all of these listings in Rockwall County that have reduced their price. Some of these are substantial price reductions. This means the days of naming your price and listing on the MLS are gone. You now have to be competitive with your pricing and do your research before going on the market.

So let’s look at all of our stats for Rockwall. Interest rates are currently at 5.23% with .9% in fees and points. Data from the Mortgage Bankers Association, ending on June 8, shows mortgage applications decreasing 21% from the same time one year ago. 

For this data I’m looking at single-family home sales in Rockwall County. 

These numbers are based on sales data from May.

The average sales price is at $552,501. That is up 24% from where it was the year before.

For new listings, we went down from last month’s massive surge, but are up 18.6% year-over-year with 332 new listings on the market. In May 2019 we had 317 new listings, so for two months in a row, our new listings have exceeded our pre-covid levels.

Even with all the new listings we are down in the number of homes for sale because they’re still not sitting long. We currently have 371 homes for sale, but in May of 2019, we had 708.

The demand is also echoed in our months of supply. Regardless of the increase in interest rates and the increasing number of new listings, we still only have 1.7 months of inventory. This means it would take about six to seven weeks for all of the houses on the MLS to go under contract based on the current demand.

The time it takes for a home to go under contract is an average of 19 days. That’s five days faster than last month.

Our average sales price per square foot is at $191 per SqFt.  That’s a 20.1% increase from last year.

The amount homes are selling for over asking has dropped from our all-time high last month. May’s average was 2.2% over the asking price. So if you consider our average sales price for May was $552,501, that means the average sales price is roughly $13,000 over the asking price. 

You can see from our actual data that things are still positive when you compare everything to last year. Prices are up. Time on market is still low. Inventory is still in the seller’s market territory. So the news headlines can sound scary, but when you look at actual numbers, what’s happening in our actual market is not all doom and gloom. Are things slowing down? Yes. Are things less competitive for buyers? Yes. Will we probably see a little stalling for the second part of June because of another increase in the Federal Funds rate? Yes. But is this the sign of a bursting bubble? I don’t think so.

You see, the overall market for DFW is still strong. Look at these Dallas-Fort Worth Economc Indicators. https://www.dallasfed.org/research/indicators/dfw/2022/dfw2205.aspx 

The DFW economy expanded, payroll employment grew, unemployment decreased, home sales increased, and housing affordability improved in Q1. On this report it also shows that the DFW population went up by 97,300 people from July 2020 to July 2021. 

We have a lot of interest in the DFW area and our growth in the technology businesses, along with others, that are moving here is fueling our housing market demand. I believe it’s possible we might see month-over-month shifts in pricing to adjust to the lightened demand (evidenced by the substantial number of price drops hitting our MLS) but overall year-over-year growth will still be strong.

So what’s the takeaway? 

Buyers, it’s a great time to start looking at the market again if you’ve been sitting it out for a little while. It’s still predicted that rates will continue to rise, therefore, it’s an ideal time to get back in the market when your competition isn’t as strong, but you still have more buying power now than you would if rates do go up. And, if you happen to be a power buyer - meaning a buyer who can pay with cash - the odds are greatly in your favor.

If you’re thinking of buying or selling in this market, let’s talk. 

If you’re a seller, you can attend one of my upcoming home selling webinars. In this webinar we’re going to talk about what it takes to sell your home in this market and give you a clear picture about the expectations on sellers right now and give you insight as to how to get even more out of the sale of your home. There’s more to it than just putting your home on the MLS and naming your price. We’re also going to answer the question, Should you list now or wait? Just visit HomeSellingWebinar.com and sign up for an upcoming virtual home selling webinar. It’s free and online.  

For buyers, I’ve got you too. You can contact me directly about buying your next home in the Dallas Fort Worth area or attend one of my free upcoming home buyer webinars. This webinar is a huge help for buyers. We’re going to talk about what to expect in this market as a buyer and how to make strong offers. And it’s not just about the cash. We’ll talk about the process from a lending side and I’ll go into more details on market trends and which submarkets have the least demand which gives you more opportunity as a buyer. I will also answer the question most buyers are asking which is, Should you wait to see if prices come down before you buy? Visit HomePurchaseWebinar.com to get registered for this free online webinar.

Or, reach out directly by contacting me by phone or text at 214-803-4444 or you can email me at JShannon@KW.com.

That’s all I have for this blog. Thanks for reading and I look forward to updating you on the Rockwall real estate market next month.