There are a variety of ways to calculate how hot a residential real estate market is.
You can look at how much money homes are selling for. You can compare how much prices have risen over a certain period of time. You can look at how many homes have sold in a certain area, as the Dallas Business Journal did in our initial installment of “Hottest Hoods in North Texas.”
Or, as we’ll do today, you can look at days on market.
The National Association of Realtors defines this metric as the number of days from the date a home is listed for sale on the local multiple-listing service to the date when the seller has signed a contract for the sale of the property.
Judging by this metric, North Texas, as a whole, is still relatively hot — albeit not as sizzling as it was last year.
"We were going 80 on the freeway, and now we're going 60,” said Lucinda Buford, a broker associate at Briggs Freeman Sotheby’s International Realty. “We’re still healthy, still moving, but we’re not going so fast that we don’t know what’s going on.”
The amount of time that homes are sitting on the market is up 22 percent compared to this time last year, to an average of 44 days, in the areas in which Buford specializes. She represents buyers and sellers of primarily high-end homes in Preston Hollow, North Dallas, Highland Park, University Park, East Dallas and Richardson.
"That's still in a very healthy range," she said. "When days on market gets too low, you start seeing houses priced too high, and you also see buyers pull out when it gets too frothy."
The reason buyers back out when the market overheats is because they fear they'll be beaten to the table, so they make an offer without fully thinking it through, Buford said.
Homes had to sell within 20 days or fewer to be among the 30 fastest-selling markets in North Texas, according to our rankings..
One North Texas county, however, is not included in the slide show, for a simple reason: Grayson County is just too hot.
New builders are moving into the area, but for the last couple of years, homebuilding hasn’t kept up with the growth, said Sherry Smith, who manages the Sherman and Whitesboro offices of Ebby Halliday Realtors.
“It’s amazing,” Smith said. “This is the most movement in our area since 1996 (when she started selling real estate in the area). It’s incredible. It’s unbelievable.”
How hot is it?
In Grayson County, homes in all 29 ZIP codes sold in an average of 15 days on the market or less, according to a MetroTex Association of Realtors report created for the Business Journal based on North Texas Real Estate Information Services data. They ranged from two days on market in ZIPs 75431 and 76308 to 15 days in ZIPs 75785 and 76018.
To include Grayson County in the 30-image slide show of Hottest 'Hoods would have essentially squeezed out almost every other neighborhood in the 14-county area we analyzed, so we left it out. The one exception that was included is Van Alstyne, which was one of the very hottest markets and straddles Collin and Grayson counties.
Most of the homes selling in Grayson County are $250,000 and above, and many are over $300,000, Smith said.
“It’s kind of like the old saying, you build them and they will come,” Smith said. “That’s what we’re seeing in our community.”
Outside of Grayson County, Buford pointed to another trend that she considers encouraging. Homes at what Buford called the "very high end" — priced north of $4 million — are selling faster, she said. That's in large part a result of low interest rates, she said.
"We’re seeing people in the very high end buying," she said. "If the smart money is being put into real estate, that’s good for all of us."
Bill Hethcock | Senior Writer Dallas Business Journal
* additional cities | photos in DBJ
ERIC MEDDERS REALTY GROUP