FAIR OAKS RANCH HOUSING REPORT FOR APRIL, 2024
Intro
This is my now monthly report of the Fair Oaks Ranch housing market. Prior to going into detail about this month’s metrics, I’ll begin with my thoughts on the overall condition of the market and the longer-term outlook for the Fair Oaks Ranch housing market.
Overall Market
In short, inflation and high interest rates have essentially crippled the housing market. The higher costs of goods and services alone have taken many buyers out of the market. Coupling this with interest rates that add potentially thousands of dollars to monthly mortgage payments has placed an almost virtual hold on buying. And as potential sellers are reluctant to shed their low interest mortgages for what may be more than double the interest rate, they are remaining in their homes, even when they desire to leave.
From everything I’ve been reading, and believe me, I’m all over this topic, we cannot expect a reduction in interest rates until late this year or early next year. The one potential bright spot for buyers is in new construction; builders are offering attractive rates and other concessions. Another potential bright spot is for first-time homebuyers. Combining an FHA mortgage with down payment assistance makes it entirely feasible to get into a home with little-to-no money needed. I was recently certified as a
Texas Affordable Housing Specialist, so if you know of someone that fits this category, please have them contact me. It is even more attractive for veterans, emergency responders and teachers.
Fair Oaks Ranch, Looking Ahead
You may consider the construction at the I-10 / 1604 interchange a nuisance. However, in terms of the long-term prospects for the continued appreciation of your home’s valuation, it’s actually a blessing. While some bemoan the growth occurring in and around Boerne, Fair Oaks Ranch’s zoning is such that there is little chance that this town will become a dense suburbia.
The TX-DOT investment in that interchange is acknowledgment of extensive growth in this direction. And Fair Oaks Ranch, with its open space, excellent schools and proximity to shopping and outdoor experiences will make it an increasingly desirable place to live. Four things will help maximize the value of your home:
Keep your home in good shape.
Ensure the schools remain top notch.
Make incremental improvements in public infrastructure.
Prevent over development.
Included in this month’s report is a housing appreciation graph for the entire San Antonio - New Braunfels Metropolitan Statistical Area. It depicts an average annual appreciation of 5.2% for the overall area. I believe the Fair Oaks Ranch / Boerne area is considerably higher. I also believe that New Braunfels has peaked in terms of its growth spike and that our area (and west San Antonio) is where we can expect increased construction and increased appreciation.
This Month’s Numbers
We remain in an unusual housing market. A cursory glance at the numbers paints a rosy picture. However, in my opinion, it certainly isn’t rosy. The numbers depict a “Seller’s Market” trending towards a “Balanced Market.” But the fact remains that there aren’t many (local) buyers and there is not a lot of inventory.
First, let's look at the Months Supply of Inventory, which is currently at 3.87. This metric indicates the number of months it would take to sell all available homes on the market at the current pace of sales. A lower number typically signifies a seller's market, where demand exceeds supply. As this is increasing, we are beginning to see homes on the market for longer periods. As I’ve mentioned previously, in many cases these homes are either over-priced, not being marketed correctly, or both.
The 12-Month Change in Months of Inventory is -19.88%, indicating a decrease in the amount of time it would take to sell all available homes. This suggests a tightening of the market and potentially higher competition among buyers. I believe this has more to do with potential sellers being reluctant to put their homes on the market than greater competition among buyers. I’m just not seeing many multiple-offer situations.
The Median Days Homes are On the Market is 18, which is a relatively short amount of time. This indicates that homes are selling quickly, likely due to high demand and low inventory. I’d like to see a modal graph of this rather than a straight median number. I’m seeing homes on the market for considerably longer. A home in my neighbor was on the market for almost nine months and ultimately sold for about $100K under the original asking price.
The List to Sold Price Percentage is 98.5%, showing that homes are selling very close to their listing price. This suggests that sellers are pricing their homes accurately and buyers are willing to pay close to the asking price. This is a very healthy number and reflects that homes are being priced correctly and sellers are making reasonable concessions.
Finally, the Median Sold Price is $825,950, which is a key indicator of the overall health of the real estate market. This price point reflects the current market conditions and demand for homes in the area. I want to take this opportunity to contrast this with the median price of a home in Silicon Valley, California, which is currently $1,600,000. THIS IS IMPORTANT: follow this link to see what $1,600,000 gets you in Silicon Valley. It’s a 3 bed, 2 bath, 1500 square foot house on a 4300 square foot lot.
The lower and middle classes have been priced out of owning a home in California. Many California homeowners have sufficient equity in their current homes to purchase yours outright, in cash. This completely eliminates any issues regarding high interest rates. If you want to sell your home in the current market, you must market your homes directly to people seeking to leave the once-great state of California.
What Makes Me Different
I am personally connected to over 1100 California real estate estate agents in over 175 cities throughout the state. Sellers that list their homes with me will have their homes presented directly to all of these agents. They know who are selling their houses and looking to leave. They also know those that cannot afford to buy there. If you are considering selling your home, let’s have a conversation.
In Short
In conclusion, the current real estate market is characterized by low inventory, questionable demand, relatively quick sales, and homes selling close to their listing price. Buyers may face competition and should act quickly, while sellers have the opportunity to sell their homes at a favorable price.
If you have found this report helpful, please share it.
Bill Ross
Bill@HillCountryHomesteads.com | 408.827.8484 | www.HillCountryHomesteads.com
