With the average 30-year fixed mortgage rate in the United States sitting well over double where it was one year ago, it seems Texans are opting to buy smaller, less expensive homes.
A survey conducted by Opendoor discovered that roughly 38% of respondents in Texas were motivated to relocate to help lower their cost of living. Nonessential luxuries were found to be a low priority. Of those surveyed in the Lone Star State, only 5% prioritized a home office, gym, or additional square footage when shopping for a new home.
According to Todd Luong, a real estate agent with Re/Max DFW Associates, many buyers are pausing home searches amidst a challenging, high-interest-rate environment. Other clients, he said, are updating their wish lists to reflect higher expected monthly payments.
“I haven’t really seen any buyers say, ‘Oh, I don’t need a home office anymore because the pandemic is over,'” said Luong, speaking with The Dallas Morning News. “But I guess naturally when buyers are trying to look for homes that are less expensive and smaller, they’re just not going to have those amenities.”
Scott Carnes, a Dallas real estate agent with Dave Perry-Miller Real Estate, also noticed a drop in home office interest compared to during the height of the COVID-19 pandemic when Americans were rushing to convert backyard sheds into soundproof workspaces. Scenic views and acreage have similarly seen a drop in priority, said Carnes.
Rural Texas is also reportedly beginning to feel the market shift. Pandemic restrictions had prompted city dwellers to seek cozy recreational ranches in the Lone Star State. While prices remain relatively high, demand for remote properties is starting to slow.
Carnes claimed more companies will eventually mandate employees to return to the office. The result, he said, will be a move back to more populated centers where homes are typically smaller.
“I think we’re still in a transition phase, but within the next year or two, yes, people are going to be expected to be back in the office,” said Carnes. “It’s going to drive some changes.”
As previously reported in The Dallas Express, a number of Dallas-based businesses are currently reconsidering the remote work trend, and some have already moved to get employees back to work on-site.