If any elephant-in-the-room factor can be gleaned from the Texas Condominium Sales Report, it’s that the pandemic is indeed influencing sales in the Dallas-Fort Worth-Arlington area.
Data in the Texas Realtors’ report covers July 2019 to June 2020. In the Dallas-Fort Worth-Arlington area, the report showed condo sales decreased 5.3 percent (3,207 sold) and townhome sales declined 0.2 percent (2,645 sold). Across Texas, condo sales decreased 9.8 percent (11,875 sold) and townhome sales declined 0.2 percent (8,616 sold).
The report analyzes data for the entire state as well as Austin-Round Rock, El Paso, Houston-The Woodlands-Sugar Land, McAllen-Edinburg-Mission, and San Antonio-New Braunfels metropolitan statistical areas.
So, where does COVID-19 come into play? Condo/townhome properties are divided into two distinct markets, and each market is seeing the pandemic’s influence.
Texas Realtors chairwoman Cindi Bulla says the urban, high-rise condo at the most expensive end of the spectrum is seeing possible evidence of flight.
“But more than likely (it’s) just a temporary softening of demand due to pandemic concerns over shared spaces, as well as concerns over the long-term economic impact on urban centers,” she says.
On the opposite end is the suburban condo/townhome market, which remains attractive for first-time homebuyers or those looking to downsize, she says. Demand is up and outpacing supply, which drives up prices.
“The pandemic and its associated shelter-in-place orders only fueled demand by serving as a reminder of the many intrinsic values of homeownership,” she said.
In the report’s executive summary: “As the Texas population continues to boom and affordability challenges increase, condominiums and townhomes provide prime options for homeowners seeking closer locales to popular attractions and essential services at all price points.”
The pandemic has created hardships on urban amenities such as restaurants and entertainment venues, which condo/townhome residents covet.
On the upside, sales prices increased: Statewide, the year-to-date median sales price as of June this year was $192,000 for condos (1.6 percent increase) and $230,000 for townhomes (1.3 percent increase).
Bulla says the sales volume decrease is likely more a reflection of supply than demand. Inventory for condos increased from 0.3 months to 5.3 months while townhomes declined 0.6 months to 4.3 months.
A market balanced between supply and demand has between 6.0 and 6.5 months of inventory, according to the Real Estate Center at Texas A&M University. In the first six months of 2020, Texas condos spent an average of 70 days on the market, while townhomes spent an average of 64 days.
Pandemics don’t last forever. And, despite the flight, condos and townhomes have a strong place in the Texas housing market.
There are amenities, of course. The affordability and a greater sense of community. And there’s the maintenance: Who wants to mow their own yard in the Texas heat?