Dallas Housing Market: Prices, Trends, Forecast 2023

The real estate market in the Dallas-Fort Worth-Arlington area has been experiencing some interesting trends and changes in recent months. In this housing report, we will delve into the key statistics and figures to provide you with a comprehensive overview of the market's performance. Whether you are a buyer, seller, or investor, staying informed about the local market conditions is crucial for making well-informed decisions in the ever-changing real estate landscape.

ALSO READ: Texas Housing Market Forecast

Dallas Housing Market Report & Trends

The Texas Real Estate Research Center provides monthly statistics on the DFW housing market for single-family homes. The Texas REALTORS® provided the data for this report. Keeping a pulse on the housing market is crucial for buyers, sellers, and investors alike. By examining key trends and indicators, we can gain valuable insights into the state of the DFW housing market.

This report delves into the key insights and trends across different housing segments within the bustling DFW metroplex. Let's examine the recent developments and projections for single-unit residential housing, single-family homes, townhomes, and condominiums.

Single-Unit Residential Housing

In the realm of single-unit residential housing, sales volume experienced a 7.03% Year-over-Year (YoY) decrease, with transactions declining from 8,804 to 8,185. The year-to-date sales reached 55,425 closed listings, with the dollar volume dipping from $4.39 billion to $4.15 billion.

Despite this decrease, the average sales price exhibited a 1.63% YoY rise, reaching $506,915, while the average price per square foot declined slightly from $215.36 to $213.59. The median price also experienced a 1.2% YoY decline to $410,000, accompanied by a decrease in the median price per square foot from $205.19 to $199.76.

Months inventory for single-unit residential housing expanded from 2.2 to 2.6 months supply, and days to sell increased from 54 to 71.

Single-Family Homes

The single-family homes segment also witnessed a 6.31% YoY decrease in sales volume, from 8,194 to 7,677 transactions. The year-to-date sales totaled 51,656 closed listings, with the dollar volume dropping from $4.18 billion to $3.96 billion.

Amidst these changes, the average sales price saw a 1.09% YoY increase, reaching $516,096, while the average price per square foot decreased from $214.12 to $211.56. The median price experienced a 1.19% YoY decline to $415,000, accompanied by a decrease in the median price per square foot from $204.13 to $198.31.

Months inventory for single-family homes expanded from 2.2 to 2.6 months supply, and days to sell increased from 53 to 71.

Townhomes

Sales volume for townhomes experienced a 13.81% YoY decrease, dropping from 268 to 231 transactions. Year-to-date sales reached a total of 1,834 closed listings, with the dollar volume decreasing from $108.71 million to $95.49 million.

The average sales price for townhomes rose by 1.91% YoY to $413,393, while the average price per square foot increased from $222.70 to $229.92. The median price also experienced a 1.28% YoY increase to $395,000, accompanied by a rise in the median price per square foot from $220.03 to $220.48.

Months inventory for townhomes expanded from 2.0 to 2.7 months supply, and days to sell increased from 74 to 78.

Condominiums

Sales volume for condominiums experienced a 20.47% YoY decrease, with transactions declining from 342 to 272. Year-to-date sales reached 1,925 closed listings, with the dollar volume dipping from $99.44 million to $89.35 million.

The average sales price for condominiums rose significantly by 12.98% YoY to $328,485, while the average price per square foot increased from $239.38 to $256.70. The median price also experienced a 5.54% YoY increase to $258,000, accompanied by a rise in the median price per square foot from $224.78 to $244.36.

Months inventory for condominiums expanded from 1.3 to 2.4 months supply, and days to sell increased from 46 to 57.

Are House Prices Dropping in Dallas?

As of the most recent data, house prices in Dallas have experienced fluctuations. While some segments of the housing market have witnessed decreases, others have shown stability or even growth.

These changes can be influenced by a variety of factors, including market demand, economic conditions, and housing inventory levels. It's essential to analyze specific market segments and consider a broader economic context to determine the overall trend in house prices in Dallas.

Is Dallas Becoming Unaffordable?

Dallas has seen a surge in economic growth and urban development, contributing to its appeal as a vibrant metropolitan area. However, this growth can also impact affordability, particularly for housing.

The demand for housing combined with limited inventory has the potential to drive prices higher, potentially affecting the affordability for some segments of the population. Addressing housing affordability requires a multi-faceted approach, involving strategies to increase housing supply, promote sustainable development, and provide solutions for diverse income levels within the city.

Is Dallas a Seller's Real Estate Market?

Yes, as of the most recent data, Dallas can be classified as a seller's real estate market. This means that there is a higher demand for homes compared to the available inventory. The limited supply of homes for sale can lead to increased competition among buyers, potentially resulting in higher selling prices and shorter time on the market for sellers.

In a seller's market, sellers may have the advantage of receiving multiple offers and negotiating terms that are favorable to them. However, it's important to note that market conditions can change over time, so staying informed about the current state of the market is crucial for both buyers and sellers in Dallas.

DFW Economy: Job Growth and Unemployment Rate

The Dallas-Fort Worth (DFW) region stands as a dynamic economic hub, characterized by its ever-evolving job market and economic landscape. Let's dive into the latest insights surrounding job growth and the unemployment rate, shedding light on the factors shaping the DFW economy.

Economic News

The most recent economic data highlights a promising trajectory for the DFW region. In July, the Metropolitan Statistical Area (MSA) witnessed an impressive increase in jobs, surging from 4,098,000 to 4,276,600. According to the Texas Workforce Commission, this remarkable feat signifies a significant 4.36% year-over-year (YoY) growth when compared to July 2022. This equates to an impressive net addition of 178,600 new jobs, showcasing the region's robust job market.

Over the past five years, the job growth rate has exhibited an encouraging pattern, growing at an average annual rate of 3.25%. This consistent expansion demonstrates the resilience and attractiveness of the DFW economy, which continues to attract diverse industries and opportunities.

Unemployment Rate

While the DFW economy flourishes with job creation, it's important to consider the unemployment rate—an essential metric that reflects the health of the labor market. In July, the unemployment rate experienced a rise from 3.70% in 2022 to 4.10%. This increase indicates a shifting dynamic in the employment landscape and warrants careful consideration.

Factors such as economic fluctuations, changes in industry demands, and global events can influence the unemployment rate. Despite the uptick in the rate, the DFW region's consistent job growth and diversified economy continue to contribute positively to the overall employment landscape.

Dallas Housing Market Forecast 2023-2024

Looking ahead to the future of the Dallas housing market, it's essential to examine the data and insights that provide a glimpse into what lies ahead for homebuyers and sellers. The Dallas-Fort Worth-Arlington region, known for its diverse economy and thriving urban centers, is a focal point for real estate activity. Let's delve into the current market conditions and explore the forecast for the Dallas housing market in the coming months.

Current Market Snapshot

According to Zillow, the average home value in the Dallas-Fort Worth-Arlington area currently stands at $373,556. This figure reflects a 3.0% decrease over the past year, illustrating a shift in market dynamics.

Notably, homes in this region are moving swiftly, with properties typically going pending in around 12 days. This rapid pace highlights the high demand and competitive nature of the Dallas housing market.

Market Forecast

The 1-year market forecast is a crucial indicator of the Dallas housing market's trajectory. As of July 31, 2023, the forecast predicts a 5.2% increase, indicating a potential rebound and positive growth in the upcoming months.

Sales Metrics

An analysis of sales metrics provides deeper insights into market dynamics. The median sale to list ratio, recorded as 1.000 on June 30, 2023, indicates that homes are being sold very close to their listing prices, illustrating a competitive market.

Of the sales recorded on June 30, 2023, 35.1% were sold over the list price, highlighting the demand-driven nature of the market. Conversely, 44.5% of sales were under the list price, showcasing the variety of pricing strategies employed by sellers.

Time to Pending and Conclusion

The median days to pending, as of July 31, 2023, stands at 12 days. This statistic reinforces the swift pace at which homes are being sought after and acquired by eager buyers, emphasizing the urgency and robust demand in the market.

Is Dallas a Good Place For Real Estate Investment? Many real estate investors have questioned whether or not purchasing a property in Dallas is a wise financial decision. If you want to know what the real estate market will be like for real estate investors and buyers in 2021, you need to dig deeper into the local trends. The Dallas housing market is an excellent place to invest in income properties, whether you're purchasing your first or simply adding another to your portfolio. It doesn't get much more “location” than this when it comes to real estate.

The Dallas housing market offers excellent profit-generating opportunities for all types of real estate investors, from first-time buyers to seasoned professionals. In Dallas, large apartment buildings and single-family homes account for the vast majority of the city's housing stock, with small apartment buildings accounting for the majority of the remaining properties. Renter-occupied and owner-occupied housing are found in equal amounts in Dallas.

Dallas is one of the cities in the United States where renting is more cost-effective than buying. A large part of the reason why Dallas has grown over the years has been the influx of young people who have settled in the city and are continuing to do so. They have preferred to start with rental properties rather than purchasing their own homes. In Dallas, the demand for rental units has increased by 14 percent in the last year, making now an excellent time to make a financial investment in the city's housing market.

Single-family homes make up approximately 43.51 percent of the total housing units in the city of Dallas. In January and February, Dallas-Fort Worth was the most active market in the country in terms of single-family construction starts. With 11,636 residential projects permitted, it ranked first in the nation for the combined number of single and multiple-family units being constructed, according to the U.S. Census Bureau's Building Permits Survey.

Dallas has a thriving economy and is experiencing steady population growth, which will help you put more money in your pocket. As rents rise, savvy investors should consider investing in Dallas commercial real estate. A single-family home or a multifamily apartment as an investment in the Dallas real estate market, regardless of whether it is a single-family home or a multifamily apartment, is an investment that can reap significant rewards if you have some experience and education in real estate investing. When it comes to investing in real estate, you need to know where to put your money, which means conducting extensive research to determine the best neighborhoods in the Dallas real estate market.

Let’s take a look at the number of positive things going on in the Dallas real estate market which can help investors who are keen to buy an investment property in this city.

Dallas is a Growing Real Estate Market

DFW, which stands for Dallas-Fort Worth, is one of the fastest-growing metropolitan areas in the United States, and as a result, it has become an increasingly popular real estate market in recent years. The region's economy is booming, thanks to a diverse range of industries such as finance, technology, healthcare, transportation, and logistics. In addition, DFW is home to several major corporations and a large number of small businesses, which has helped create a robust job market.

Furthermore, the population in DFW has been steadily increasing over the past few years, with many people moving to the area for job opportunities and high quality of life. This growth in population has led to a surge in demand for housing, both for homeownership and for rentals. As a result, real estate investors in DFW have seen excellent returns on their investments in recent years.

Another reason why DFW is a growing real estate market is its location. The region's proximity to major cities such as Austin, Houston, and San Antonio, as well as its access to several major highways and airports, make it a hub for business and commerce. This has helped attract investors and businesses from all over the country and the world, further fueling the growth of the local economy and real estate market.

Overall, the combination of a strong economy, population growth, and strategic location make DFW a prime real estate market for investors looking to capitalize on the region's potential for long-term growth and profitability.

No State Capital Gains Tax

One of the reasons that make investing in DFW real estate attractive is that there is no state capital gains tax in Texas. Capital gains tax is a tax paid on the profits made from selling an investment or asset such as real estate, stocks, or bonds. In most states, capital gains are subject to both federal and state taxes, which can significantly reduce the return on investment.

However, Texas does not impose a state capital gains tax, which means that investors can keep a larger portion of their profits from the sale of real estate. This tax advantage is a big draw for investors looking to maximize their returns and grow their real estate portfolios.

Furthermore, the absence of a state capital gains tax is not the only tax benefit that real estate investors in DFW can enjoy. Texas has one of the lowest property tax rates in the country, which means lower operating costs for real estate investors. This makes it easier to generate positive cash flow and maximize returns on investment.

Dallas' Strong Economy

Dallas is one of the fastest-growing cities in the United States and has become a hot spot for real estate investment due to its strong economy. The city boasts a diverse range of industries, including finance, technology, healthcare, and energy, all of which have contributed to its robust economic growth. Here's a closer look at the factors that make Dallas' economy a reason for real estate investment.

One of the most significant drivers of the Dallas economy is its location. Dallas is situated in the heart of the United States, making it an ideal location for businesses to operate nationally. The city has a well-developed transportation network, with two major airports, extensive highway systems, and a busy port, which has made it a transportation hub for goods and people.

The city's diverse economy has also been instrumental in driving growth. The finance and insurance industries, for example, employ a significant portion of the city's population. Dallas is also home to several Fortune 500 companies, including AT&T, ExxonMobil, and American Airlines, which provide a stable source of employment and contribute to the city's economic growth.

Another factor contributing to Dallas' economic growth is its thriving technology sector. The city has become a hub for tech startups, thanks to its favorable business environment, which includes low taxes, affordable real estate, and a business-friendly regulatory environment. Companies like Texas Instruments, which has its headquarters in Dallas, have helped to spur technological innovation in the city.

The healthcare industry is another critical component of the Dallas economy. The city is home to several world-renowned medical centers, including the University of Texas Southwestern Medical Center and the Baylor University Medical Center, which have attracted both medical professionals and patients to the area. The healthcare industry has contributed significantly to the city's economic growth, providing thousands of jobs and driving demand for real estate.

Finally, the energy industry has been a significant contributor to Dallas' economic growth. The city has long been a center for oil and gas production, and it continues to be an important player in the energy sector. The presence of major energy companies, such as ExxonMobil and Chevron, has created a significant source of employment and investment in the city.

Overall, Dallas' strong economy has made it a prime location for real estate investment. The city's diverse range of industries, transportation network, and favorable business environment have helped to drive economic growth and create a stable source of employment. The city's real estate market has responded accordingly, with strong demand for both commercial and residential properties. The combination of a thriving economy and a robust real estate market makes Dallas an attractive destination for real estate investors looking for long-term growth opportunities.

Strong Dallas Rental Market

Dallas, Texas is a thriving and rapidly growing city that has been attracting people from all over the world. It is the ninth most populous city in the United States, and the Dallas-Fort Worth-Arlington Metropolitan Area is the fourth largest metropolitan area in the country. With such a large population and an ever-growing economy, the city offers great potential for investment, particularly in the rental market.

The rental market in Dallas is robust and has been growing steadily in recent years. The demand for rental properties is high, and the supply has not kept up with the demand, which has led to a shortage of affordable housing. The strong rental market in Dallas is due in part to the city's population growth.

According to the U.S. Census Bureau, the Dallas-Fort Worth-Arlington Metropolitan Area had a population of over 7.5 million in 2020, and it is projected to grow by another 1.5 million people by 2030. As the population continues to grow, the demand for rental properties will also increase.

Another factor that makes Dallas an attractive market for rental property investment is the city's strong economy. Dallas has a diverse and dynamic economy that is driven by various industries, including technology, healthcare, finance, and energy. A strong economy and low unemployment rate translate into more people looking for rental properties.

Moreover, the cost of living in Dallas is lower than in other major cities in the United States, making it an attractive destination for people looking for affordable housing options. This factor is particularly important for millennials, who are the largest group of renters in the country. According to a report by RentCafe, Dallas is one of the top ten cities in the United States where millennials are renting the most.

Investing in rental properties in Dallas can be a lucrative business, but it requires careful planning and research. One of the first steps in investing in rental properties is to identify the right location. Dallas is a large city with many neighborhoods, each with its own characteristics and market dynamics. Investors should look for neighborhoods with high rental demand, low vacancy rates, and strong appreciation potential.

Another important factor to consider is the type of rental property. Single-family homes, duplexes, and apartments are all viable options, but each has its own pros and cons. Single-family homes offer more privacy and space, but they can be more expensive to maintain. Apartments are more affordable and easier to manage, but they may have higher turnover rates. Duplexes offer a balance between the two, but they may be harder to find.

Investors should also consider the costs associated with owning and managing rental properties, including property taxes, insurance, maintenance, and repairs. These costs can add up quickly and eat into profits if not carefully managed. Investors should also be prepared for unexpected expenses, such as emergency repairs or vacancy periods.

Hence, we can say that the strong rental market in Dallas makes it an attractive destination for rental property investment. The city's growing population, strong economy, and affordable cost of living create a favorable environment for investors looking for long-term returns. However, investing in rental properties requires careful planning, research, and management to ensure success. With the right strategy, investors can capitalize on the strong rental market in Dallas and build a profitable rental property portfolio.

The Zumper Dallas Metro Area Report analyzed active listings across the metro cities to show the most and least expensive cities and cities with the fastest growing rents. The Texas one bedroom median rent was $1,139 last month. Grapevine ranked as the most expensive city with one-bedrooms both priced at $1,630 while Mesquite ranked as the most affordable city with one bedrooms priced at $1,070.

The best place to buy rental property is about finding growing markets. Cities like Richardson, Plano & Garland are good for investors looking to get started with rental property ownership at an affordable price. These trends provide a macro look at the growing rental demand. Each real estate market has its own unique supply-demand dynamics with unique neighborhoods that present their own opportunities for investors.

These cities look good for rental property investment this year as rents are growing over there.

The Fastest Growing Cities For Rents in DFW (Year-Over-Year)

• Rockwall rent was the fastest growing, up 15% since this time last year.
• Fort Worth saw rent climb 11.4%, making it second.
• Garland was third with rent increasing 8.8%.

The Fastest Growing Cities For Rents in DFW (Month-Over-Month)

• Grapevine had the largest monthly rental growth rate, up 4.5%.
• Dallas was second with rent climbing 3.6% last month.
• Grand Prairie & Weatherford both saw rents jump 3.4% last month, making them tied for third.

Texas Real Estate Market: Investment Opportunities

NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Dallas.

Consult with one of the investment counselors who can help build you a custom portfolio of Dallas turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Dallas.

Not just limited to Dallas or Texas but you can also invest in some of the best real estate markets in the United States. All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Dallas turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.

For a majority of investors, buying or selling real estate is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

Texas is a great market for real estate investing. If you have decided to invest in Dallas, you can either buy a fixer-upper or you may want to buy a Dallas investment property. This market offers a wide range of turnkey investment properties; you just have to find your tenants to rent out the property.

Good cash flow from Dallas investment property means the investment is, needless to say, profitable. On the other hand, a bad cash flow means you won’t have money on hand to repay your debt. Therefore, finding the best investment property in Dallas in a growing neighborhood would be key to your success.

When looking for real estate investment opportunities in Dallas or anywhere in the country, the generally accepted standard is to purchase a property that will give you a modest but minimum of 1% profit on your investment. An example would be: at $120,000 mortgage or investment cost, $1200 per month rental. That would be the ideal equation for example. Even with rent increases, buying a $500,000 investment property in Dallas is not going to get you $5000 per month on rent.

The three most important factors when buying real estate anywhere are location, location, and location. The location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Dallas investment property and you should be able to get a good return on your investment over the long term.

The neighborhoods in Dallas must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. A cheaper neighborhood in Dallas might not be the best place to live in. A cheaper neighborhood should be determined by these factors – Overall Cost Of Living, Rent To Income Ratio, and Median Home Value To Income Ratio.

It depends on how much you are looking to spend and if you are wanting smaller investment properties or larger deals in Class A neighborhoods. The inventory is low, but opportunities are there.  Apart from Dallas, you can also invest in the housing market of Houston. Houston has a track record of being one of the best long-term real estate investments in the U.S. The Houston Real Estate Market forecast is good, and current housing prices are relatively low. The Houston metro area offers great opportunities for investors who are looking for a stable market that offers both cash flow and equity growth at a price that is STILL well below their replacement value.

The next one is the San Antonio real estate market. For those who want to invest in rental real estate, the San Antonio real estate market is an ideal location because of its outsized military presence. Fort Sam Houston is located inside the city limits. Lackland Air Force Base, Randolph Air Force Base, Camp Bullis, and Camp Stanley are located in the immediate vicinity. This means that there is a large population that will almost always rent because they don’t know where they’ll be sent on their next assignment.

San Antonio has a dearth of affordable housing because demand is so much greater than supply. This has created a large number of renters who need to pay quite a bit to rent apartments or single-family homes. We know there is a lack of housing relative to demand when a balanced market has a 6 month home inventory and San Antonio has only a two-month inventory.

The El Paso real estate market is another hot market to invest in. El Paso real estate market was ranked 4th in Trulia’s hottest real estate markets to watch in 2018. El Paso’s strong job growth, affordability, low vacancy rates, and high population of young households were pivotal in the ranking process. The cost of living in El Paso is lower than the national average, while the cost of housing is well below that of other major metropolitan areas, including Houston and Austin.

The Central, Cielo Vista, and Mesa Hills areas offer more affordable rental properties for sale, while neighborhoods in the northwestern and eastern parts of the metro area have some of the more expensive housing inventory. The amount residents spend on everyday expenses, such as food and transportation, is slightly less than what the average American pays.

The Austin housing market is one hot place to invest in Texas. It isn’t the largest in the state of Texas, but there are several reasons to consider buying real estate in this city. The Austin real estate market has gained a lot of steam, with home values almost doubling since 2010. The Austin real estate market isn’t as big as Dallas, San Antonio, or Houston. One of the long-term strengths of Austin is its diverse economy. The Austin real estate market dipped after the layoffs of the Dot-Com boom. They decided to solve the problem by encouraging medical and biotech employers to relocate to the area, too. As of this writing, there are 85 biotech and pharmaceutical companies in Austin.

Let us know which real estate markets in the United States you consider best for real estate investing! 

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Caveat emptor applies anywhere you buy property. Some of this article's information came from referenced websites. Norada Real Estate Investments provides no explicit or implied claims, warranties, or guarantees that the material is accurate, trustworthy, or current. All information should be validated using the below references. Norada Real Estate Investments does not predict the future US housing market.

Sources:

• https://www.texasrealestate.com/market-research
• https://www.mymetrotex.com/market-reports
• https://www.zillow.com/dallas-tx/home-values
• https://www.neighborhoodscout.com/tx/dallas/real-estate
• https://www.realtor.com/realestateandhomes-search/Dallas_TX/overview
• http://www.homebuyinginstitute.com/news/dallas-forecast-one-of-the-hottest
• https://www.zillow.com/research/zillow-hottest-markets-2021-28667/
• https://www.zumper.com/blog/dallas-metro-report/
• https://www.zumper.com/rent-research/dallas-tx
• https://www.rentcafe.com/apartments-for-rent/us/tx/dallas/#rent-report
• https://www.mashvisor.com/blog/dallas-investment-properties
• https://rentberry.com/blog/dallas-investment-opportunities