Buy/Wait Dilemma (Frisco, Prosper: real estate, mortgage, home builders)

[Utah'n]

Hello,

I am very well aware that none of us probably have a definite answer with the current uncertain times but still would like to know your thoughts!

We have been considering moving to the DFW area and actually found something we like in a new construction in the Prosper area. BUT, we are hesitant to proceed further keeping in mind all the current speculations in the housing market. Going by the past price history of these homes, looks like the builders sold these homes for closer to $700k in August 2020 while they are now over a Million.. Looking like a 45% hike since Aug 2020.

For the locals in the area:

1. Have the home price gains been so MASSIVE in the DFW (Prosper) area? Am I reading something wrong? I really don't understand how such massive pricing gain is sustainable in the area.
2. What would be your guess on future home pricing in the area? If prices correct, what % cuts are you expecting/or would be reasonable?
3. I read that the market is softening all over the country but I haven't seen any softening on new contraction in the area yet. Really torn on if we should wait or just jump in? Of course, it is tricky to wait as none of us probably know how long to wait for?

Appreciate your inputs/thoughts!

[Wittgenstein's Ghost]

You might as well go to the politics forum and ask "So.....Republicans or Democrats?"

There are several other current, active threads here right now discussing this very question.

[hereticiam]

Here is a recent thread about buy wait dilemma https://www.city-data.com/forum/dall...it-2022-a.html

We are waiting. I would not buy new construction at this time either. Build quality has been impacted by material and labor shortage. There can be long delays in building new homes as well. Just read reviews of any large builder and read the horror stories. Go to Reddit real estate forum and see how new home builder are dropping prices and folks who paid more are not happy.

[texstout]

I have no statistics to back this up, but it 'feels' that most people buying new construction in the suburbs/exurbs are from out of state. We constantly see people on this site coming in from OOS and from abroad looking for these new builds. I wonder if that is helping to keep the prices up high.

[hereticiam]

I also have no statistics to back this up but most people of Indian origin prefer new homes over existing homes. A lot of people of Indian origin are moving to Frisco, Prosper, and buying new homes.

[crazyforger]

Originally Posted by utah'n

hello,

i am very well aware that none of us probably have a definite answer with the current uncertain times but still would like to know your thoughts!

We have been considering moving to the dfw area and actually found something we like in a new construction in the prosper area. But, we are hesitant to proceed further keeping in mind all the current speculations in the housing market. Going by the past price history of these homes, looks like the builders sold these homes for closer to $700k in august 2020 while they are now over a million.. Looking like a 45% hike since aug 2020.

For the locals in the area:

1. Have the home price gains been so massive in the dfw (prosper) area? Am i reading something wrong? I really don't understand how such massive pricing gain is sustainable in the area.
2. What would be your guess on future home pricing in the area? If prices correct, what % cuts are you expecting/or would be reasonable?
3. I read that the market is softening all over the country but i haven't seen any softening on new contraction in the area yet. Really torn on if we should wait or just jump in? Of course, it is tricky to wait as none of us probably know how long to wait for?

Appreciate your inputs/thoughts!

wait

[Utah'n]

Originally Posted by texstout

I have no statistics to back this up, but it 'feels' that most people buying new construction in the suburbs/exurbs are from out of state. We constantly see people on this site coming in from OOS and from abroad looking for these new builds. I wonder if that is helping to keep the prices up high.

Thank you for the input! That definitely looks like one of the factors! I wonder if this would sustain in the long-term.

[Utah'n]

Originally Posted by crazyforger

wait

Thanks!

[Utah'n]

Originally Posted by hereticiam

Here is a recent thread about buy wait dilemma https://www.city-data.com/forum/dall...it-2022-a.html

We are waiting. I would not buy new construction at this time either. Build quality has been impacted by material and labor shortage. There can be long delays in building new homes as well. Just read reviews of any large builder and read the horror stories. Go to Reddit real estate forum and see how new home builder are dropping prices and folks who paid more are not happy.

Appreciate your inputs! I am still seeing some new home builders hiking up the prices in the area!

[callmebutter]

I am in prosper. It is that bad here.

I bought in 2019 for $450k - 2 of the exact same houses (same lot size, floor plans, sqft) in same neighborhood have sold for $596k in June 2021 and for $715k in June 2022.

For the neighborhoods you are looking at (I can probably guess which ones), that started in the high 700's 2 years ago are definitely pushing $1m and are selling (new and used).

Further, if you are buying at all in this area you are getting hit with massive tax valuations from the county. I have friends in those neighborhoods who literally had 100% increase in valuation 750k to 1.5m. Most likely, you'll ahve to share your purchase price with the county to get the lower valuation because they overestimated on some. But purchase price is not public information in texas. I say this because taxes on $1.1M in prosper ARE going to be $22-24k per year.

Also be careful buying new construction in Prosper and surrounding areas. Some have MUD/PID taxes which are additional taxes to pay for the infrastructure.

My take on Prosper - availability will stay scarce because people already in Texas don't want to buy or move in the current market (inflation, mortgage rates, home price) - i think prices will slow and some "could" drop but not much more than maybe 10%. i say if you find what you want here for the price you can afford then jump on it - its a gamble if it slows/declines - i think we are done with the massively quick increases for a bit though. because if you ever sell, you'll still be profitable because of all the growth in the area. Problem is $1m homes have mortgage payments and interest rates suck which eats so much into your buying power.

ETA - Tax Estimate for $1.1M home in Prosper city limits, prosper ISD

Tax Unit Appraised Value Exemption Net Taxable Value Tax Rate Tax Amount
01 - Collin County 1,100,000 55,000 1,045,000 0.168087 1,756.51
05 - PROSPER CITY 1,100,000 137,500 962,500 0.510000 4,908.75
60 - COLLIN COLLEGE1,100,000 11,000 1,089,000 0.081222 884.51
81 - PROSPER ISD 1,100,000 40,000 1,060,000 1.460300 15,479.18
Total Tax 2.219609 $23,028.95