Newly constructed or continuing construction homes have been popping up all over Lubbock, from $1 million dollar homes to $260,000, despite a cooling market.
This influx of new homes helped boost active listings to 51% in September, though closed sales went down by 17%. Rich Eberhardt, president of the Lubbock Association of Realtors, explained that this is in response to an extremely low inventory in the spring.
A balanced market would usually have 4-6 months of inventory, but in the spring, Lubbock had three weeks worth. Eberhardt said if no new homes entered the market at that time, they would have sold out in three weeks.
“Earlier this spring, we had no inventory, interest rates were very low,” he said. “Builders recognized that and started building a lot of homes, but it takes time to build a house. Now, our inventory is triple what we had, and a large part of that is new construction.”
Price range
The starting price tag for a new construction is around $250,000, and those new builds are dominating about half of that price range.
About two-thirds of the homes listed in September’s data were priced at $300,000 or less, which holds much of the demand. While homes listed at less than $250,000 still sell quickly, the market has cooled since the spring.
“The market has cooled quite a bit,” he said. “Interest rates are much higher now as well, so we are starting to see some builders offer incentives to get their houses sold. Some help with closing costs, offer landscaping allowances, those kind of things.”
Location and schools
Location and school districts are other key factors in what buyers seem to focusing on. Oakmont, Vintage Township, Kelsey Park and south of 130th Street homes are seeing an increase in interested buyers, and higher priced homes.
“Some subdivisions around Kelsey Park are building million dollar homes and million dollar specs (homes without buyers yet), which hasn’t been done in Lubbock prior to the last few years,” Eberhardt said.
Out of 16 homes listed at more than $1 million on Oct. 27, seven of them are new constructions. The second most expensive home at $1,599,000 is a new build in the Sedona Addition. Another new home listed at $1,495,000 will be on Uxbridge, and may not be completed until next year.
“I would say in general, people gravitate toward new or newer homes,” he said. “We see a lot of people asking for those.”
Counting the 907 homes on the market in September, the median price for a home is $243,623. Homes are staying on the market 23 days on average, just two more than in September 2021.
“In June, we saw prices increase about 16%, which, in a normal market, we’d see 1-2%, so this year was a real aberration,” Eberhardt said. “I don’t see prices going down, but I don’t see an increase at the same level that they did last year. This is (becoming) a more normal market. I’ve been doing this for 27 years, and I’ve never seen a market like this year’s.”
Moving into the future, Eberhardt hopes to see interest rates come down from 7%. The peak selling season in Lubbock tends to be March-July, he said.
“So, from now until January, don’t expect as many buyers out there,” he said. “It’s a great time to buy, because you’re not pressured into making a decision, or don’t necessarily have to pay a lot more than the list price.”
Alana Edgin is a journalist covering Business News in Lubbock and the surrounding area. Send her a news tip at aedgin@lubbockonline.com.
