What’s clear everywhere is that the urgency is gone. With so much more inventory on the market, buyers no longer have to assume they’ll need to give up their inspection rights or appraisal protections just to get a contract accepted.
01
Where prices have softened
Many of the northern suburbs, including Frisco, McKinney, Prosper and Celina, have settled back more than other parts of the metro. So have some eastern markets with a lot of new construction, like Rockwall and Forney.
These are the areas that saw the most growth in recent years. Many people moving to Texas from other states chose them for well-rated school systems, sometimes smaller student-to-teacher ratios, and larger lots. Retail followed, so today you can find many of the same restaurants and grocery stores there that you’d find closer to the core of the city.
The challenge now is supply. Resale homes in those areas are competing head to head with new construction, and builders are offering incentives like rate buydowns that individual sellers often can’t match. We talk through how buyers weigh their options on our show, SOLD with Updike Pugh, in Episode 354: Remodel or Flip.
02
Where prices have held
The established neighborhoods toward the core of the city have held their value much better. Lake Highlands, Lakewood, the M Streets, Preston Hollow, Midway Hollow and Timberbrook are all good examples.
03
Higher rates slowed sales, not prices
The rise in interest rates hasn’t forced prices down. What it has done is slow the number of transactions and take the urgency out of the market.
If you’re waiting for rates to fall before you buy, keep this in mind. The Federal Reserve just raised its benchmark rate on September 16,1 and its latest projections point to one more increase this year and no cuts in 2027.2 You could be waiting more than 15 months, with no guarantee rates drop even then.
Today’s mortgage rates are still below the long-run average going back to the early 1970s.3
You can always refinance if rates go down. You can’t buy a house at yesterday’s price.
04
Sellers: price it right from day one
Pricing a house correctly is incredibly important right now. You have to look at the trend of the market as well as the last several comparable sales in the neighborhood.
We recently had a listing priced almost exactly where we recommended to the owner. It went under contract in the same number of days on market as the competing sales in that neighborhood.4
When a seller insists on a higher price, we talk through the possible outcomes together. Most of the time, overpricing by around 5% simply means more time on the market. The more extreme cases are harder. We had a condo owner who insisted on listing 10% over market. That condo sat for almost a year and a half, and it ultimately sold at almost exactly the price we recommended in the first place.4
05
Cosmetics aren’t enough anymore
If you’re selling, don’t overlook the big-ticket items. Buyers have become much more particular about core systems like the roof, the foundation and, on older homes, the sewer lines. Fresh paint and new light fixtures won’t carry a house that has problems underneath.
06
Where prices are headed
I expect Dallas prices to increase slightly over the next 12 to 24 months, possibly only 2 to 3%. That’s steady, healthy growth, not a boom.
That’s why the most important question isn’t whether prices are up or down this month. It’s how long you plan to own the home. A short ownership period doesn’t give the market time to appreciate. A longer one does. I go deeper on that in my earlier post, “Is Now a Good Time to Buy a House in Dallas?”
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