You can find different attractions in each neighborhood and district that makes up Dallas, from spectacular museums and beautiful parks to impressive performing art venues.
In addition, the city is home to delectable southern cuisines for those who want to explore captivating cultures through delicious food, popular zoos and museums, and major Fortune 500 companies.
Dallas also offers a great quality of life and many job opportunities. Plus, it has a diverse economy led by different industries, including transportation, telecommunications, financial services, information technology, defense, and more.
It's also one of the country's fastest-growing cities with the highest employment growth.
These are just a few reasons why many people want to move to Dallas. The city is a wonderful place to live, whether you are a millennial looking for a new home or a seasoned real estate investor wanting to start a business there.
However, before making a decision about your next real estate purchase, you should consider several aspects, including the latest Dallas housing market trends, experts' predictions, and more.
Fortunately, you can find all the information you're looking for here. Read on!
Dallas Housing Market Trends
As mentioned, there are many things that you should take a look at if you want to buy a property in this city. The latest housing market trends fall into this category.
Analyzing the changes or fluctuations in the real estate market can help you make a sound decision regarding your housing investment.
According to Redfin's latest reports, housing prices in Dallas fell in April this year after a drop of almost 5% compared to the figures reported in 2022.
Additionally, homes now spend more time on the market before going under contract. What does it mean? Is the Dallas housing market struggling? Here's more information on the city's real estate trends.
Dallas Median Home Prices
Redfin issued a report on the changes the Dallas housing market experienced in April 2023, showing that home prices have fallen 4.8% year over year in this city.
After the drop in home prices, the median listing home price for all home types was $414,000. This is the average value for each type of property:
- The median sales price for single-family homes is $472,500 after a 3.0% year-over-year decline
- The median listing price for townhouses is $515.00 after increasing by 10.2% year over year
- The median sales price for condos/co-ops is $275,000 after falling 8.5% year over year
However, it's important to know that the April median price in Dallas is higher than in March, which means that property values have risen after a prolonged negative period.
Redfin's reports also showed that the number of homes sold in April 2023 fell by 20.95% to 929 compared to last year's figures. In 2022, the number of housing units sold was 1,175.
However, the number of units listed and purchased in April is considerably higher than in January of this year when just over 500 homes were sold. Also, it's only 30 fewer properties than in March.
Data collected during the last three months of last year showed that the Dallas market experienced a significant drop in home inventory. However, there are signs of recovery.
According to January 2023 reports, the monthly housing inventory in Dallas rose from 0.7 to 2.2, considering only single-family homes.
Additionally, compared to 2022 figures, active listings are up by 175.60%, while new listings rose by 12.21% year over year.
Redfin's reports also showed that 32.5% of homes in Dallas, Texas sold above the list price. While it's a 33.1% drop compared to last year, the number is still high.
Additionally, 28.2% of residential properties had price drops in April 2023, which accounts for a decline of 10.7% year over year.
Overall, the sale-to-list price ratio for all home types in April was 99.1% after a 5.6% drop year over year.
Median Days on the Market
The latest reports also show that Dallas homes are spending more time on the market before being officially purchased.
Redfin showed that the median days on the market increased by 10 days, reaching 25 days in April 2023. In the same period last year, homes spent only 15 days listed before going under contract.
However, although there was an increase from last year, the median days on the market in Dallas is still low.
According to SoFi, Texas is the 19th state with the highest foreclosure rate in the country, as it only reported 2,678 foreclosures in March 2023.
The foreclosure rate in the country's second-most populous state was one foreclosure filling in 4,270 households. However, there are 11,433,880 housing units in Texas, which means the number is relatively low.
SoFi's list also showed the counties with the highest number of foreclosures, which are Cochran, Madison, Liberty, Ector, and Camp.
Factors That Often Affect the Dallas Housing Market
Many people think that changes in the Dallas-Fort Worth (DFW) housing market result only from negative events or crises. However, different aspects can influence the real estate sector.
These are the main ones:
The City's Economy
The economy has a direct impact on the housing market. If it's facing a slowdown, and the city's residents aren't confident about their income or personal finances, the demand for residential properties will drop.
However, people often buy properties and invest in the real estate market when they have a solid income or feel that the economy is booming, which results in high demand for homes and rising prices.
How's the economy in Dallas? According to 2022 reports, the GDP in the Dallas-Fort Worth (DFW) metro grew by 3.1%, positioning the city among the country's top 10 major metros.
Also, as mentioned, the city is home to many businesses and employers, which means there are many job opportunities for residents. According to the US Bureau of Labor Statistics, the unemployment rate in the Dallas-Fort Worth-Arlington metro fell from 4.1% in February to 3.9% in March of this year.
In other words, many people living in Dallas have a solid income.
Mortgage Interest Rates
Both in Dallas and in other US cities, mortgage interest rates also impact the housing market. The higher they are, the less affordable the properties are. Consequently, both demand and prices fall.
Conversely, prices and demand go up when the costs to get mortgage loans and purchase a housing unit increases.
However, mortgage interest rates have risen significantly across the country in recent months. In May, they reached 6.79% for 30-year loans and 6.16% for 15-year loans.
Changes in Demographics
Experts also pay attention to demographics because changes in the composition of the population can also have significant effects on the real estate market.
Different aspects, such as people's age, income, migration patterns, and race can define the demand for a specific type of housing.
Redfin's April 2023 reports showed that Texas is considered one of the country's five most popular states among homebuyers looking for a new place to live.
Additionally, Texas has always been a top destination for Hispanic immigrants.
Did you know that the government can also control housing demand and prices through local tax policies? From tax credits to subsidies and deductions, these factors can greatly affect the Dallas market.
Analyzing the Texas government's tax policies can help you identify false trends and determine if buying property in any city across this state, including Dallas, is a good idea.
Will the Dallas Market Crash Soon?
Many homebuyers and real estate investors are worried about a potential market crash, as experts predict the US will face a recession soon.
However, the following signs show that the market is unlikely to crash:
- The housing demand is rising
As mentioned, Dallas is a popular destination for people looking for a good place to live. Also, many migrants move to this city every year. Demand for homes rises as a result.
- Fewer new houses are built
Due to the tedious and time-consuming processes of buying land and property, many people don't want to build new houses.
The number of newly built homes directly influences the inventory, so it's expected to remain low.
- The housing supply is falling
A real estate market often crashes when the supply is too high compared to the number of potential homebuyers. However, the Dallas housing inventory is still low.
In addition, the city remains very attractive across different demographics. Consequently, demand is high, and properties will sell faster, meaning supply will remain low.
- Lenders are stricter
Lenders are increasingly strict with the requirements to get a loan. In fact, most only approve financing for people with excellent credit scores. As a result, there is no fictitious purchasing power altering demand or housing inventory.
- The number of foreclosures is going down
Texas has a low foreclosure rate compared to many other states. Also, foreclosure filings are falling across the country, which suggests that people are more confident about their financial situation.
Dallas Housing Market Statistics
Have you thought about investing in a real estate property in Dallas? Do you want to buy a house in this city because you plan to move there?
In addition to the latest trends and signs of a potential market crash, you should also consider these statistics to make a sound decision:
- According to Redfin, the median sale price for a property in Dallas (per square foot) was $244, which accounts for a 2.8% drop from 2022.
- Redfin's reports also showed that the average home in Dallas sells about 1% below the list price. These properties also go on pending after the first 28 days.
- However, Redfin also claimed that hot houses in Dallas, TX, often sell for around 2% above the list price after going pending in around 13 days.
- About 3% of people interested in buying a home searched to move into Dallas from other major cities.
- Additionally, 82% of Dallas homebuyers expected to stay within the Dallas metropolitan area.
- The Dallas-Fort Worth (DFW) housing market had 4,322 sales in January 2023, which accounts for a 27.24% drop compared to last year's figures.
Housing Market Predictions by Experts
Do you still have questions about whether buying a house in Dallas is a good idea? This is what experts say:
Mortgage Interest Rates Will Continue to Increase
Many analysts believe that mortgage interest rates may rise as high as 8.5% as the Fed tries to rein in rising inflation and the country faces increasing geopolitical tensions.
Home Prices Will Continue to Fall
If mortgage interest rates are higher, home prices are likely to drop. Experts predict that property values may drop as much as 10% this year.
The Housing Supply Will Remain Low
In Dallas, the housing supply rose. Actually, it happened in many cities across Texas. However, the inventory is still too low. Analysts also believe fewer homebuyers will be willing to sell properties if the mortgage interest rate rises to 7%.
Dallas Housing Market Forecast (2023-2024)
The Dallas market is one of the most affordable housing markets in Texas. Properties are often cheap, and there are usually many opportunities for real estate investors.
However, those fluctuations that the Dallas real estate market has experienced in recent months make many people wonder if buying a residential property in this state is a good idea. Here's what the experts say about it.
Based on the latest reports, Zillow predicts the housing supply will remain low in Texas' major cities, including Dallas.
Also, while the Dallas-Fort Worth-Arlington metro has seen home prices rise slightly since January 2022, Zillow's forecast for 2023 remains negative.
Experts predict that home values in the DFW metro will fall by 0.5% until recovering shortly after January 2024.
The Final Verdict
Dallas is one of the most prosperous cities in Texas. Besides offering beautiful attractions and impressive entertainment venues, this destination is also home to numerous universities and companies.
Plus, there are many major employers in Dallas, including the University of Texas Southwestern Medical Center, Baylor Scott & White Health, Lockheed Martin, Texas Health Resources, and more!
However, as mentioned, real estate investors and homebuyers should consider different aspects before purchasing a property in this city.
Home prices have fallen, and experts expect the value of housing units to remain low for a few months. However, that doesn't mean you should rush to buy property in Dallas.
If you consider the trends seen in the Dallas-Fort Worth (DFW) market, experts' predictions, and key statistics, you can make a better decision.
Frequently Asked Questions
Is It a Good Idea to Buy a Dallas Investment Property?
While many housing markets seem to show signs of improvement after a turbulent period with many fluctuations, investors still have to consider many aspects before making a decision.
It's still impossible to predict what will happen to the Dallas-Fort Worth (DFW) real estate market soon. Therefore, if you want to know if buying an investment property in this city is a good idea, you should consider other factors, such as your preferences, budget, and risk tolerance.
Are you still unsure if buying a property in Dallas is a good idea? Remember that you can also contact a seasoned real estate agent and ask for professional help to devise the right investment strategy according to your unique situation.
Is the Dallas Housing Market Balanced?
Many people also wonder if Dallas is a balanced market before making an investment decision.
As mentioned, the local housing inventory has started to rise, showing signs of a shift toward a balanced market. However, since supply is still too low, sellers can keep prices high and lead negotiations, which means Dallas is truly a seller's market.
Is the Dallas Rental Market Strong?
Yes, it is! One of the reasons why many real estate investors choose Dallas is because the rental market in this city is strong.
Currently, the rental real estate market is solid and competitive across Dallas-Fort Worth and North Texas, as the state is highly attractive to migrants, workers seeking relocation, and young people in their prime buying years.