Plano North July 2021

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lower price points, Kelly said. “We are seeing sales growth in those counties, sometimes 30% to 40% year-over-year,” he said. “Part of the reason is when you get out to those areas, the aordability starts to come down.” Mary Reeves, a Plano-based Real- tor with Ebby Halliday, said most of her current clients are empty-nest- ers who have the cash on hand to go above asking price. But even those buyers are having to be exible about what they are willing to accept in a home, Reeves said. “They are having to say certain things are OK that they probably wouldn’t have a few years ago,” she said. “Most of that has been in updates—they think, ‘OK, I can just update it later.’” After touring around 70 homes and putting in above-asking oers on three properties, Erin Frey and her husband purchased a house near Coit Road and Park Boulevard in Plano. She said they had a wishlist for what they wanted in a home but were forced to make a slew of con- cessions due to the lack of available options in their price range of around $400,000. “It’s not the ideal neighborhood that we would have liked to move into, but it’s the one that we’re in,” Frey said. Buyers looking to purchase a home right now should set realistic expec- tations about what they can nd under current market conditions, she said. “Make your hierarchy of needs but be ready to settle and move fast,” she said. Resolving issues of supply Skyrocketing prices are not the only

“The million-dollar price point has been on re—anything above that has been selling at an accelerated pace—but when it comes to someone looking to buy in the [$200,000 and $300,000 price range], that is a very dicult property to nd right now,” Kelly said. Despite these challenges, real estate experts hold out hope that inventory levels will go up as seller condence is restored and issues around the building supply chain are resolved. “We do expect the market to slow down,” said Jim Gaines, an econ- omist with the Texas Real Estate Research Center. “The dominoes have to fall in the right order and at the right time.” Effect on first-time homebuyers High levels of demand mean most homes are selling for above asking price. But the bank will only approve a loan for what a home is worth, said Lisa-Marie Thompson, a loan ocer with Primary Residential Mortgage Inc., which has oces across the metroplex, including one in Plano. Many rst-time homebuyers do not have the cash on hand tomake up the dierence, Thompson said. May data from the Collin County Associ- ation of Realtors shows the median home in Plano sold for 104.4% over asking price, which is up from the 98.2% recorded a year prior. “This isn’t a market that is feasi- ble for them,” she said. “It’s almost impossible.” As a result, millennials and other rst-time homebuyers are leaving Plano and moving to less populated counties—such as Grayson, Kaufman, Hill, Parker and Ellis counties—that have a greater supply of homes at

The median price of homes in Plano has increased by 76% since January 2015. Data for 2021 is accurate through June.

0 $500K $400K $300K $200K $100K

$440,000

$250,200

SOURCE: COLLIN COUNTY ASSOCIATION OF REALTORS COMMUNITY IMPACT NEWSPAPER

The 30-year mortgage rate in Texas has tumbled to historic lows in recent years. Buyers eager to settle into an already-hot housing market see this as an added incentive.

0 1 2 3 4 5 6 7

Housing market accelerates as 30-year rate drops under 3%

SOURCE: RESIDENTIAL STRATEGIES INC. COMMUNITY IMPACT NEWSPAPER

thing preventing rst-time homebuy- ers from entering the market. Baby boomers and other older residents are aging in place, which is curtailing resale inventory, Kelly said. “What we have found is that peo- ple are living longer, they’re health- ier, and they’re staying in their homes longer,” Kelly said. “So there wasn’t this natural migration out of homes … that would have created a

supply as millennials grew into the homebuying age.”’ The prevalence of investors buy- ing single-family homes as rental properties is also responsible for low levels of supply, Jolly said, noting he estimates 30% of buyers in the metroplex are investors. “A lot of them have a very, very high level of cash,” he said. “So, they’re putting either 50% down or

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