Denton County home prices hit a new record high in March with the average price of a Denton County home posting at just over $360,000. Median home prices for Denton County also hit a new all-time high rising to almost $320,000. That was a jump of 8 percent from March of last year.

While home prices throughout the DFW area were hitting new highs at the end of the first quarter, actual closed sales of homes declined 5 percent in March. Denton County saw a similar 5 percent decline in home closings for the month. Pending sales in Denton County show to be 9 percent lower, mirroring the 7 percent decline in pending sales for the Dallas Fort Worth area. While sales have cooled so far in 2018, the inventory of homes for sale in Denton County has been moving higher.

As we ended the first quarter, here are some of the relevant market stats for Denton County Texas:

  • Average Home Price – $360,235 (Up 6.5%)
  • Median Home Price – $319,937 (Up 8.0%)
  • Average Days on Market – 46
  • Homes For Sale 2751 (Up 7.9%)
  • Closed Sales 1177 (Down 5.8%)
  • Pending Sales (1298 Down 9.4%)

It is now readily apparent that the housing market in the DFW area is cooling from the rapid growth seen during the past few years. That’s probably a good thing in terms of long-term sustainability. While there were 9259 homes sold throughout the DFW area during March, the winds of change were signaling the end of the housing mania here in the Dallas Fort Worth which has seen investors and flippers jumping through the hoops to snatch up affordable homes.

By traditional historical measures, there aren’t many affordable homes left in the DFW area. That’s why we are witnessing a cooling of actual sales. The combination of record high prices and higher mortgage interest rates has put a damper on affordability and demand.

The Dallas area housing market is still on solid footing for the time being, but that doesn’t mean things can’t change rather abruptly. What you aren’t being told by Dallas’ largest newspaper or any of the industry “experts” quoted in the DMN is the real story about what drove Dallas area home prices to new heights.

DFW h0me prices have been detached from real fundamentals like wage growth for several years running. A certain cooling of prices and/or activity was inevitable. What remains to be seen is how this latest cycle plays out. The Federal Reserve’s asset inflation mechanism goes into full reverse later this year. The Fed is currently pulling $30 billion per month of liquidity off the table. The effect of lower SALT tax deductions will likely become more evident at the end of 2018 when the Fed will be tightening by $50 billion per month. This is going to have implications for the Dallas area housing market.

The flattening yield curve is a reminder that the spin artists in DC are spinning a good message with little substance to back it up. If you are in the market to buy or sell a home, be careful who you get your advice from. There are plenty of pundits in the real estate sector who want to “sell” you something even if it’s a blatantly obvious work of fiction. Every day is not a good day to buy a home…Some days are better than others!