In the McAllen, TX market in September, new home closings declined year-over-year, and with a percentage decline steeper than August 2015, there were signals the market may be worsening. New home closings saw a 31.0% drop from a year earlier to 40. This followed a 23.0% fall year-over-year in August.
A total of 616 new homes were sold during the 12 months that ended in September, down from 634 for the year that ended in August.
Out of all housing closings, new home closings represented 6.4%. This is down from the a year earlier when new home closings accounted for 8.8% of total closings. Closings of new and existing homes fell year-over-year in September after also falling in August year-over-year.
Pricing and Mortgage Trends
In September, the average value of new homes saw a 14.5% bump year-over-year as it grew to $195,253 per unit. This surge compares to a 2.4% drop in August from a year earlier.
The average mortgage size on newly sold homes saw a lift year-over-year along with new home prices. In September 2015, the average mortgage size was $184,670, up 19.4% from a year earlier. It went from $155,477 to $156,970 from August 2014 to August 2015.
Other Market Trends
The percentage of new home closings belonging to single-family homes has risen from last year while the portion of new home closings belonging to attached units has dropped. Single-family home closings gained from 98.3% of new closings in September 2014 to all of closings in September 2015. Conversely, the share of new home closings belonging to attached units slid to no part of closings from 1.7% of closings.
There was a 35.5% surge year-over-year in the average unit size of newly sold homes to 2,501 square feet in September 2015. The average size of newly sold homes moved from 1,796 square feet in August 2014 to 2,035 square feet in August 2015.
Foreclosures and real estate owned (REO) closings fell in September from a year earlier, but stayed a drag on the market. Combined, foreclosures plus REO closings made up 26.4% of existing home closings, below 27.4% a year earlier. The percentage of existing home closings involving foreclosures fell to 11.9% in September from 14.3% a year earlier while REO closings as a percentage of existing home closings grew to 14.5% from 13.1%.