Amarillo Area Housing Market Commentary
YTD March 31, 2017
703 single family homes closed during the first quarter of 2017 as compared with 765 closed sales during 1Q 2016; a decrease of 8.10%. However, the 703 closed sales in 1Q 2017 is only the sixth time ever that closed first quarter sales exceeded 700 as reported by the Amarillo Association of Realtors multiple listing service (MLS). Additionally, the 2017 Amarillo Area housing market started much slower than usual, not really getting underway until mid-February, about 30 days behind the typical market behavior. We attribute the slower-than-normal start to the fixation on President Trump in the weeks leading up to and immediately following his inauguration.
Other measurements of the market were very positive including the average sales price which was up 2.74% to $173,767 along with the median sales price increasing 2.11% to $150,000, both at all-time highs for sold prices in the first quarter. The average days on market fell to 92 days from 104 days a year ago. At the same time, the sales price to list price ratio rose slightly to 96.84% of listed prices from 96.56% a year ago. The available inventory of homes for sale continues to challenge the market with only 966 active MLS listings as of March 31, 2017, just 12 more homes for sale from one year ago, and down 34 listings from December 31, 2016.
Factors influencing the local housing market include the local unemployment rate which stood at 3.6% according to the February report from the Texas Workforce Commission with 1,100 more people employed than one year ago; conventional 30-year mortgage loan interest rates at 4.375%, up one-half percent from where rates stood a year ago. On another positive economic note, foreclosure activity continued to drop in the first quarter to 61 foreclosures from 79 foreclosures in the first quarter of 2016, the lowest number of first quarter foreclosures reported in the last ten years.
Buyers remain most challenged by the lack of available MLS inventory which stands at 4.12 months of inventory as compared to Texas A&M’s Real Estate Center’s definition of a balanced market as being 6.5 months of available inventory. Buyers are facing fewer choices and higher sales prices, especially for those homes priced below $250,000. Multiple offers remain quite normal for those homes that are competitively priced and in good condition.
2017 Amarillo Housing Market Activity
703 closed sales in 2017 compared with 765 closed sales in 2016, an (8.10%) decrease from one year ago.
Single Family Home Prices
Average single family home prices were up 2.74% to $173,767. Median single family home prices were up 2.11% to $150,000.
There were 966 active single family listings in the multiple listing service (MLS) as of March 31, 2017. This represents an increase of 12 listings from one year ago.
As a result of the decreased sales activity and slight increase in inventory, the number of months of available inventory is 4.12 months as compared to 3.74 months one year ago.
110 new single family homes were permitted during the first quarter of 2017 compared with 174 in 2016, a decrease of (37.78%). The decrease is somewhat skewed by the fact that the 2016 total included 57 attached homes (townhomes), thus the actual decrease in detached single family permits was seven. The continued shortage of ready-to-build lot inventory and a tight labor supply challenges new home construction within the Amarillo city limits. Fortunately, an increase in developed lots is forecast by year end.
Foreclosure Activity (no breakdown of residential and commercial foreclosures)
Both properties posted for foreclosure and actual foreclosures were down from the first quarter of 2016. Postings fell from 146 in 1Q 2016 to 1226 in 1Q 2017 (a 16% decrease) while actual foreclosures fell from 79 in 1Q 2016 to 61 in 1Q 2017 (a 23% decrease).
3,725 Single Family Sales
$183,000 Average Sales Price and $161,000 Median Sales Price
1,000 Active Listings at year-end
450-500 Single Family Building Permits