Christina Cataldo, a school teacher, was growing stir crazy. She was not literally confined to her one-bedroom apartment, it just seemed that way.
“I was working from home, spending my entire day at the kitchen counter. I would cook there, eat there, work there. My whole life centered around that counter. I was going crazy,” said Cataldo, 31, who teaches at Hewitt Elementary School and whose husband, Dan, works at SpaceX, a company with designs on someday sending space travelers to Mars.
Originally from Connecticut, the Cataldos relocated to Houston, then to Waco, as they followed job opportunities. Paying rent to Springs at Cottonwood Creek Apartments would do for the time being. The couple eventually would desire more space, a backyard for the dog, but they were in no hurry.
One might say COVID-19 and market conditions forced their hand. And it appears many found their own favorable conditions to buy a house in Waco last month, 47.4% more than in May and 10.5% more than June last year.
“I had some friends who were refinancing their homes at really low rates,” Cataldo said. “We’d be in the same boat, financing-wise, so we started looking just to see what would happen.”
She retained Roman Novian, with Coldwell Banker Apex Realtors to spearhead the search.
“We would find a house we liked, tell Roman, and the next day it would be gone,” she said, noting the sizzle of Waco’s housing market even as the pandemic short-circuited much of what once passed as normalcy.
Just recently, the Cataldos cornered their elusive first home, a three-bedroom, two-bath residence about 10 minutes from their apartment complex, Cataldo said.
“We paid around $250,000, which was at the upper end of our range,” she said. “The seller gave us a good deal, worked with us on closing, left the washer and dryer. This is the first house we’ve ever bought, and we didn’t know what to expect, but Roman made it a great experience.”
Homes changed hands briskly in June despite less than ideal conditions.
A total of 410 homes were sold last month, according to A.G. Real Estate Associates, using information compiled by a Waco multiple listing service.
That is 39 more than the 371 sold in June last year, well before COVID-19 appeared on the scene. It also represents a more than 47% jump from the 278 homes sold in May and an almost 65% jump from the 249 sold in April, when local agent Ashton Gustafson prepared a market report in which he said “shelter in place was the primary factor for the abrupt change in market activity.”
Further analysis shows the Cataldos bought a home priced in a range that proved popular in June. The average list price, according to A.G. Real Estate Services, was $242,935, while the average sales price was $234,169.
Homes on average sold for 97% of list price. Homes that sold stayed on the market an average of 60 days, one day more than in May.
“Statistics don’t lie,” Novian said of the 410 transactions in June. “We’re still seeing people making moves, putting homes on the market.”
But he also senses hesitation among those weighing possibly the biggest decision in their life, considering conditions at work in today’s economy.
“We have an election coming up, COVID-19, the rioting — they could cause people to hold off until current events slow down,” he said. “Still, in real estate, there is always a need to move. People must have a place to live. There are still buyers and sellers. People are still putting houses on the market. And we’re still getting multiple offers.”
Novian said potential clients started calling him weeks into the pandemic.
“I think they were bored at home, looking online, and decided to do what they’d been thinking about doing a long time,” he said.
It helps that interest rates are falling, Novian said.
The average rate on a 30-year fixed-rate mortgage fell to 2.98% last week, dipping to less than 3% for the first time in at least the 50 years Freddie Mac has been tracking it, the government-back financing firm reported Thursday. The average rate on a 15-year fixed-rate mortgage was 2.48%.
“Rates have dropped almost 2 percentage points over the past year and a half, helping drive up homebuying demand and keeping home prices from dropping during the COVID-19-related recession,” according to a post by the Texas A&M Real Estate Center. “For a mortgage in the amount of the national median home price (around $285,000), the rate drops this year would save a borrower more than $100 a month in payments and roughly $50,000 over the course of the loan.”
Andrew Fraijo, a California native and an agent with Magnolia Realty licensed to broker sales in Texas and California, said he sees clients “sick and tired of being sick and tired.” He said “conservative refugees” from California find economic and political conditions locally more to their liking.
“They want to be part of what’s going on in Texas, and Waco is smack dab between the Metroplex and the craziness in Austin. What better place?” Fraijo said. “People 55 and older, meanwhile, are moving here from the Midwest and Northeast because they can’t do cold anymore.”
Already a growing trend before COVID-19 struck, working from home is becoming the new normal for people employing technology to escape larger cities. They can live anywhere and choose to live in Waco, Fraijo said.
Housing inventory remains a shortcoming locally, and agents especially yearn for homes priced at $250,000 or less, he said.
Fraijo said COVID-19 will create a shakeout in the housing market on two fronts: foreclosures will mean “deals to be had, and we will get our fair share, though they will hurt larger metropolitan areas more than us.” Second, older people and those with underlying conditions who fear letting would-be buyers into their homes may become sellers with the virus under control.
Waco residential specialist Pam Tucker-Hanson said she enjoyed sales of $3.2 million in June, with many contracts signed in May and closed in June, and online views of her listings have tripled during the pandemic.
“Overall, the Waco market is great, still trucking along,” Tucker-Hanson said. “The job market has been stable, has not affected the buying demographic. We’re seeing new construction. Robinson has three or four new developments.”
She agreed with others that new residents are spending freely.
“We’re getting a lot of California transplants,” she said. “I actually closed a deal with one today. We’re seeing a lot of out-of-state people, a lot of entrepreneurs who can work from home and it doesn’t matter where they live.”