At 4 a.m. on a Thursday morning in early May, Mike and Kendra Gibson of Commerce headed to the hospital to have their second child, Birdie.
But the baby wasn’t their only priority that day. They were also trying to buy a house in Carrollton — and they had been through too much rejection to let this deal slip. So while Kendra was in labor, Mike was working nonstop to get their next home.
It takes determination to succeed in a housing market that has become ultra-competitive since the pandemic. Inventory has rapidly diminished as buyers take advantage of low mortgage rates and builders wrestle with high materials costs and delays.
There were only 2,418 homes listed for sale in Dallas-Fort Worth in March, down 88% from the 20,853 available two years ago, according to the Texas Real Estate Research Center at Texas A&M University. (Data was revised April 18.)
The D-FW housing market had just 0.7 months of inventory available in February, half of what it had a year earlier, marking the fifth-largest decrease of the metro areas surveyed in Re/Max’s national housing report.
Prices have soared from a median sale price of $318,045 in March 2020 to a record $380,000 in March 2022. Houses are selling for an average 4% over asking price across all North Texas counties, according to multiple listing services data.
“Across all price points, values are increasing,” said Bryan Pacholski, senior managing director of real estate firm Compass in Dallas-Fort Worth. “That is challenging buyers in this market.”
Todd Luong, a real estate agent with Re/Max DFW Associates, said many of his clients have temporarily given up on buying because prices have become unreasonable or they’re tired of endless searches and losing bidding wars.
Homebuying is already a “very emotional process, and a very stressful process,” Luong said. “Once you add this crazy market to it, it makes it even worse.”
Pacholski said buying activity has started to slow over the past couple of months due to exhaustion from buyers, soaring prices and rising mortgage rates.
“We’re in a bona fide sellers’ market, so prices have just crept up beyond what was almost reasonable inside the normal market trends,” Pacholski said. “Buyers are starting to certainly take a step back.”
While some are calling it quits for now, the Gibsons are one of many families going the extra mile to get a home. For some, that means offering far above the list price with a hefty down payment. For others, it means doing the work to transform an unbearable property just to get into their desired neighborhood.
No time to waste
In the middle of last April, Mike Gibson was offered a job as an estate manager and private chef for a family at a large estate in North Dallas’ Preston Hollow neighborhood. He and Kendra had less than two months to sell their home in Commerce and move to the Dallas area, more than an hour away.
Their budget for a new home was $500,000 to $600,000. Since they lived in the country, Mike didn’t have a sense of how much homes were going for in D-FW’s hot market — or how competitive the couple would have to be to get one.
“We were not really prepared for the cost of a home and what you were getting for that cost,” he said.
At the first open house they went to in Carrollton, the street was lined with cars. They made an offer on it, to be told later by the listing agent that there were 26 other offers substantially over the asking price, Mike said.
“We realized at that point, we would have to lower our standards to pay over asking, to get a house,” Kendra said.
In the first week of May, weeks before starting the new job, Mike saw a four-bedroom, midcentury home in Carrollton with a unique koi pond sitting just outside the living room. He thought it might be the one, but Kendra wasn’t convinced.
Still, they went through the process. Their agents, Katie and Matt Harris of Rogers Healy & Associates, walked through the home for them, showing them the house on a video call. The Gibsons loved it and were ready to make an offer.
The sellers declined their offer of $25,000 over the asking price that night. Early the next morning, Kendra went into labor.
Matt called Mike at 10 a.m. with demands from the seller, who wanted a higher bid and wouldn’t accept an offer that was contingent on the sale of the Gibsons’ home in Commerce. Mike called around to lenders and financial advisers, scrambling to move money around to make it work.
In the meantime, Kendra was ready to have the baby. Mike was on the phone with Matt and ignored a call from her at first. She called him again.
“And I was like, ‘Hey man, this might be important, I gotta take this,’” Mike said.
Matt says he didn’t even know Mike and Kendra were at the hospital until Mike got back to her room.
Mike hung up the phone, and 10 or 15 minutes later, the baby was born. Half an hour later, the couple signed the final offer, which was $50,000 over the asking price.
“In my defense, we needed a house really bad,” Kendra said.
Kendra and the baby spent the night in the hospital. The next day, as they were getting in the car to leave the hospital, they got word that they were under contract.
On Saturday, less than a day later, they drove about two hours with their 1-day-old daughter to see the house for the first time. Even though the Gibsons were under contract, the listing agent was holding an open house just in case their deal fell through.
They closed on the four-bedroom home June 7, when Birdie was a month and a day old, and they love the house. It has a huge backyard, an extra room for guests and space for Kendra to work on her stained-glass art and Mike to do woodworking. “It’s just so perfect for us,” Kendra said.
With so many heartaches throughout the process, Kendra said it was hard to believe that they would ever get a home, especially in a good area, but they did. And in addition to loving the house, they have come to realize how much they enjoy living in Carrollton and being close to their neighbors.
“We came from the country, where it was 15 minutes to get anywhere at all,” Kendra said. “We miss parts of the country, but to move to such a sweet community made it a lot easier.”
Braving the walk-through
The house Jacob and Monika Thompson bought last year was far from a dream home. It looked fine from the outside, but when they opened the door it smelled “like a pet store or pet boarding home,” Monika said.
After entering the home with their real estate agent and not being able to stomach the stench, they immediately walked to the back patio and started thinking about their next showing.
Jacob decided they should go back and look at the primary bedroom and bathroom just in case they needed to reference it later. The stench was even worse in that part of the house.
The couple, who have two kids — one 16 and the other 7 — had decided to move from New Braunfels to Frisco early last year. They frequently visited friends there, and the more they made the trip, the more they liked the area, especially for its schools and diversity.
In January 2021, they finally took the leap, selling their home after just a week on the market. They quickly realized that getting into a home in Frisco would not be as easy.
“We were expecting to get up here and purchase a home right away,” Jacob said. “That was not the case at all.”
Monika, who works as a dental hygienist, said their house in New Braunfels on a third-acre lot with a three-car garage was her dream home. She wanted to buy a similar property in Frisco. She remembers describing her house to their real estate agent and getting a response of, “Do you have a million dollars?”
“It was a rude awakening,” she said.
With a budget of $450,000, they found the market fiercely competitive. They wanted to build a home, but Jacob said they were turned off after visiting a community where there was a waiting list of 133 families while the builder was selling only four homes a month.
Jacob went to one open house where 200 people were crammed in, elbow to elbow, just to see one home.
The couple realized they would have to make some sacrifices to get the location and square footage they wanted — and they’d have to put in some work after buying as well.
They put offers on homes every weekend for three months. Starting out, they would offer $25,000 over the asking price, and eventually they started offering $50,000 more.
On one house, they offered $75,000 over the asking price, according to their real estate agent, Prime Blankenship of Dallas firm Scottie Smith & Associates Real Estate Advisors.
“I told the [seller’s agent] the number, and he just laughed at it,” Blankenship said. “He was like, ‘This is not even in the universe of where you need to be to get this house.’”
Adding frustration to the process was the fact that Jacob, an Air Force retiree, was pursuing a VA loan, which put the family at a disadvantage competing with buyers who had conventional loans or could pay all cash. Blankenship said some sellers are wary of buyers with VA loans, thinking they are not qualified to buy the home because they don’t have to put any money down.
“They’re benefits that people have earned,” Blankenship said. “It turned into a hurdle that we had to clear.”
So three weeks after they first saw the smelly house, they returned. With four bedrooms along with a media room and game room, it was far bigger than any other home they were looking at, and they liked the layout. Luckily, the house had been cleaned some and smelled a little better when they returned.
“Once we were actually looking at it then, it made sense,” Blankenship said.
It took a few days after that visit for Monika to get on board. Tired of the process, she even thought about going back to San Antonio. But she was swayed by texts from her brother, who convinced her that the couple would be priced out of Frisco if she didn’t go with this house. They went under contract in May.
Since buying the home, they renovated it top to bottom, from the floors and the walls to the air conditioning. They also added a covered back patio.
“Once the home was painted and all the flooring was changed, the smell was completely gone,” Jacob said. “Now when we walk into this home or even when we just look around, it feels like our home.”
A hunt disrupted
Pele and Vonda Nunley have been on the hunt for a larger house since late 2020. The couple has two sons, one a 19-year-old student at Louisiana State University and the other a 15-year-old who goes to Grace Preparatory Academy in Arlington, where his mother is the principal.
The family has been in Mansfield since 2007 but is looking across the southern Dallas suburbs. Their ideal home would accommodate the couple’s parents eventually living with them. They’d like two primary bedrooms, space for multiple cars and a backyard with a pool, a sports court and plenty of space to entertain guests.
“We’re kind of at a dilemma now, still looking for a deal, still wondering if we should just wait or if we should just go ahead and jump in the market at the prices that they’re at now,” Pele said.
They were looking for homes priced from about $1 million to $1.7 million. But just over a year since beginning their search, homes in this range have doubled in price, Pele said.
The scarcity of housing is affecting prices in all segments of the market. In March 2020, 1,142 homes were on the market in North Texas for $1 million or more, according to Multiple Listing Service data. Two years later, there were 407 homes on the market for that price.
“We kind of had an idea of how much we wanted to spend and what we thought we would be getting for that,” Pele said. “And now, we’re finding that for that same amount of money, we really can’t find a much bigger house than we currently have without spending a lot more money.”
Their real estate agent, Dee Lemmons of Premium Realty Group in Waxahachie, said that across three cities they’re considering, there may only be five listings that have what they’re looking for.
“It’s just as competitive in their price range as it is in the lower price ranges,” Lemmons said.
Initially the family planned to keep their home and rent it out. Pele said it would sell for $500,000 or more, so now that prices are so high, they’re considering selling just to have enough money to buy a new home.
Some of the houses they were interested in sold in one or two days, and some sellers only accepted cash offers. On some properties, the sellers accepted an offer by the time they put theirs in.
Pele, who owns a restoration company, said they would consider buying a home that needs work, but even those properties are selling quickly.
“It’s a sad process, and it’s a frustrating process,” Vonda said. “We have faith that one day, our dream house will come and everything will fall into place the way it’s supposed to.”
March 30 was an exciting day for Riley and Amanda Rosvold and their two sons, one who turns 2 in April and one who’s almost 3 months old. The moving truck was arriving at their new home in Celina’s Light Farms community, capping off a move halfway across the country from Ridgefield, Wash., near Portland.
Riley, who ran sales for a refrigerated trucking company, lost his job in December after the company shut down operations due to the pandemic. A friend of his who runs a residential solar company in North Texas had been trying to get him to come work for him for years. Plus, the couple thought the state would be a better place to raise their young kids.
Riley took a sales job at his friend’s company, and they got to work on finding a place to live.
Like many other homebuyers in a market with so few homes, they struggled to find properties they wanted to put offers on, let alone get their offers accepted. They were looking for houses in Celina and Prosper, and the process took almost two months.
On two homes, one in Prosper and the other in Celina, they didn’t even get a chance to put in an offer because they were off the market by the end of the day they looked. The Celina house sold for more than $100,000 over its asking price of $630,000, according to the Rosvolds’ agent, Leigh Calvert of Douglas Elliman.
One home they put an offer on in Light Farms received more than 40 offers, and another property got an all-cash offer that was more than $100,000 over the list price.
The couple put four or five offers on homes during their search.
They found that to be competitive, they had to pay over the asking price, have a large down payment and cover various fees. For the home they finally bought, they wrote a letter telling the seller about their family, where they were from and how they would live there, plus photos.
“I think there’s a personal element to selling your house that can sometimes be forgotten when it goes into just looking at numbers, dates and a net figure,” Calvert said. “If you’re in a competitive situation, it’s definitely something to consider.”
The family closed on their three-bedroom house March 21, paying more than 10% over the asking price. The home has a backyard, an office, a movie room and a game room that doubles as a guest room.
The move was emotional as the family left both Riley’s and Amanda’s parents behind in Washington. Riley’s parents flew down to help them unpack. “It was a leap,” Riley said. “It’s nerve-wracking in a sense but also exciting. I don’t know how to explain it.”
With the hustle of buying a home behind them — as well as the sale of their house in Washington, which closed March 17 — they can settle into their new neighborhood.
“Even with our story of having a bunch of offers that weren’t accepted, I feel as though we got pretty lucky,” Riley said.
»The Texas Squeeze: A series examining the high cost of high growth in North Texas.