New home closings in the McAllen, TX market fell year-over-year in March, and there were signs of weakening market conditions with a percentage fall steeper than that of February 2016. There was a 63.6% fall in new home closings from a year earlier. In comparison, new home closings in the same month last year saw a 41.5% drop year-over-year in February.
A total of 543 new homes were sold during the 12 months that ended in March, down from 571 for the year that ended in February.
As a percentage of overall housing closings, new home closings accounted for 3.6%. This is down from the a year earlier when new home closings accounted for 6.2% of total closings. Following a year-over-year decline in February, closings of new and existing homes also dropped year-over-year in March.
Pricing and Mortgage Trends
The average price of newly sold homes slid 21.9% year-over-year in March to $128,827 per unit. This drop follows a move from $169,509 per unit to $168,923 from February 2015 to February 2016.
Average mortgage size on new homes declined year-over-year in contrast to new home prices. Average mortgage size declined 21.6% to $122,302 in March from a year earlier. In February 2016, average mortgage size on newly sold homes saw a 4.1% hike year-over-year from a year earlier.
Other Market Trends
The share of new home closings made up by attached units has risen while the share belonging to single-family homes has fallen. The share of new home closings belonging to attached units gained from no part of closings in March 2015 to 6.2% of closings in March 2016. Conversely, the share belonging to single-family homes sank to 93.8% of closings from all of closings.
There was a 14.3% decline year-over-year in the average unit size of newly sold homes to 1,598 square feet in March 2016. In February, the average size of new homes sold went from 2,120 square feet a year earlier to 1,717 square feet.
Foreclosures and real estate owned (REO) closings continued to rise in March from a year earlier and remained a drag on the market. Foreclosures and REO closings, taken together, represented 29.2% of existing home closings, up from 24.0% a year earlier. The percentage of existing home closings involving foreclosures rose to 13.2% in March from 11.6% a year earlier while REO closings as a percentage of existing home closings rose to 16.0% from 12.4%.