The Dallas-Fort Worth-Arlington real estate market is much like Texas weather: steady and predictable — except when it isn’t.
For example, the coronavirus pandemic caused home prices to jump dramatically in 2020 and 2021, and that made buying a home in Dallas and its nearby suburbs much more expensive than it had been.
In 2024, the Dallas-area housing market has seen its housing values decline slightly — which isn’t a bad thing, says Todd Luong, a real estate agent with RE/MAX DFW Associates. Luong says the local real estate market has more inventory available and the median sales price has dropped, making Dallas-Fort Worth-Arlington accessible for buyers who can afford to live there.
“During 2021 and 2022, when the market was on fire, Dallas just went on a tear. We were leading the country in price appreciation with 20 to 30% growth in a year,” Luong said.
“But inventory levels were too low. If you look at the past 12 months, we’ve had a 50% increase in inventory,” Luong said. “The amazing thing is we have so much more inventory but prices only dropped 1%? That tells you how resilient and healthy the Dallas real estate market is.”
Using data compiled from the U.S. News Housing Market Index, we collected information you need to know about the current state of the Dallas-Fort Worth market. Here’s what you should understand about the Dallas housing market in the recent past, now and looking ahead into 2025.
[See: Why You Should (and Shouldn’t) Sell Your Home in 2024]
How the Dallas-Fort Worth Housing Market Changed in 2024
Newly approved construction permits for single-family and multifamily houses (those with two or more housing units) saw slow but steady growth in 2024, according to the U.S. News Housing Market Index. In July 2024, the most recent data available, there were 4,246 newly approved construction permits for single-family homes compared with 3,532 at the same time in 2023, a 20% increase year over year.
Permits for single-family homes for the year steadily increased from 3,516 in January 2024 through July. Permits for multifamily homes for the year declined slightly from 2,454 in January to 2,238 in July, the most recent data available. Year over year, multifamily permits declined nearly 8%.
[IMAGE]
[IMAGE]
The Dallas-Fort Worth-Arlington area is interesting because its suburbs have some of the fastest-growing cities
in the country, and select cities such as Princeton have temporary banned residential development to let its infrastructure catch up, Luong said. In September, the Princeton City Council voted to stop approving new permits for residential development for four months because rapid growth was overwhelming the city’s infrastructure.
“Princeton is one of those towns about 45 minutes outside of the heart of Dallas where housing is a lot more affordable. As a result, the population grew exponentially,” Luong said. “It’s definitely a seller’s market in Princeton.”
[Multifamily and Single-Family Rental Housing Market Trends]
Dallas Housing Supply and Demand
The Dallas-Fort Worth-Arlington area has about a 3.5-month housing supply on the market, which is up nearly a month year over year, according to the U.S. News Housing Market Index. Traditionally, a six-month supply of homes is desirable, Luong says. Some parts of the Dallas market have a four-month supply right now.
Housing supply refers to the number of months it would take to sell all the homes now on the market at the current rate, without new inventory coming on the market.
[IMAGE]
“It’s still below what you would see in a balanced market. It’s a seller’s market,” says Luong. “But it feels balanced because of that craziness we saw in 2021 and 2022. We’re seeing home sellers dropping their home prices and being more flexible in their terms. And we’re seeing buyers offer lower than what the prices are on the house.”
Rental vacancies were 9.3% in the second quarter of 2024, nearly flat year over year, according to the U.S. Census Bureau. That is about the same as the national vacancy rate, which was 6.6% the second quarter 2024, according to the U.S. Census Bureau. Nationally, the rental vacancy rate was higher than the rate in the second quarter 2023 (6.3%) and virtually the same as the rate in the first quarter 2024 (6.6%).
Mortgage applications increased 11% from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Applications Survey for the week ending September 20, 2024. In fact, mortgage applications increased to their highest level since July 2022, boosted by a 20% percent increase in refinance applications after a large increase the prior week.
The unadjusted Purchase Index increased 0.4% compared with the previous week and was 2% higher than the same week one year ago.
% Consumer sentiment in June was up 3.8 points year over year to 68.2 out of 100, based on the Survey of Consumers from the University of Michigan. Consumer sentiment has remained virtually unchanged in the last three months.
[IMAGE]
Median Home Price in Dallas-Fort Worth
The median home price is down 1.2% year over year to $425,000 in the Dallas-Fort Worth-Arlington area, the U.S. News Housing Index found. Luong says that figure is huge compared to where the area was a decade ago, but housing values have soared in recent years.
[IMAGE]
Interest rates have a lot to do with more buyers coming into the Dallas-area market. The Federal Reserve cut interest rates recently, and that has buyers putting a toe back into the real estate market in hopes of finding their dream home, Luong says.
“That Fed cut (in September 2024) was a warm welcome to a lot of buyers,” he says. “A lot of buyers have been on the sidelines because we all had gotten used to seeing low rates in recent years. Once rates got up to 5 or 6%, a lot of buyers decided to step out of the market at that point and put their search on hold. Now with rates coming down, people are starting to evaluate their housing options again.”
The rental market has continued to see price increases, with the average rent around $2,025 in the Dallas market in September. That is up an average $12 year over year, according to Zillow, but is still lower than the median rent in the United States, which is around $2,100.
[Pros and Cons of Selling Your Home in the Fall]
Unemployment Trends in Dallas-Fort Worth
More than 4.29 million people were employed in nonfarm positions in the Dallas market, with an unemployment rate of just 4.1% in August 2024, according to the U.S. Bureau of Labor Statistics. That is lower than the national unemployment rate of 4.2%.
Total nonfarm payroll employment increased by 142,000 in August, and the unemployment rate changed little at 4.2%, the U.S. Bureau of Labor Statistics recently reported. Job gains occurred in construction and health care.
Employment
4.29M
[IMAGE]
Unemployment
4.1%
[IMAGE]
Construction jobs in the Dallas-Fort Worth-Arlington area are up nearly 1% year over year to 37,700, according to the Bureau of Labor Statistics
Mortgage delinquencies and foreclosure activity are relatively stable in the Dallas-area market. Foreclosures are at 0.3%, which is a 0.1% decrease year over year. Delinquencies are up 0.2% year over year to 3.9%.
Builder Confidence in Dallas-Fort Worth Declines
The National Home Builders Association and Wells Fargo Housing Market Index is designed to track the pulse of the single-family housing market nationwide. Builder confidence in the market for newly built single-family homes was 41 in September, up two points from a reading of 39 in August. This breaks a string of four consecutive monthly declines, the HMI said.
That number for the Dallas-area market was 43, down 15 year over year.
Building for commercial rates is 46.30, down 2.6 year over year, according to the Architecture Billings Index from the American Institute of Architects. The Architecture Billings Index (ABI) is a monthly survey that measures the demand for architectural services and construction activity. A score above 50 indicates an increase in billings compared with the previous month, while a score below 50 indicates a decline.
Nationally, the ABI remained “sluggish,” according to the American Institute of Architects, with an August score of 45.7. It reported it has been nearly two years since firms saw sustained growth.
Dallas-Fort Worth Real Estate Market: Predictions
Luong believes the Dallas-area market will see its typical slowdown into the fall and winter as buyers are less interested and fewer houses go onto the market because of the holidays.
“Texas winters aren’t brutal, so we do see some activity. But the spring is our busiest time of year for sure,” Luong says. “On the positive side, I’ve been getting calls from buyers who are now ready to look again because of the drop in interest rates.”
He says Dallas-area homes are taking a bit longer to sell and that’s likely to continue into the start of 2025. But he is telling his sellers that it is normal and not to be alarmed. On average, homes are staying on the market for about 52 days.
“I keep telling my clients that having a home on the market for a few weeks is nothing wrong,” Luong said. “I’ve been in real estate for 17 years and lived in Dallas for 40 years. Dallas has always been in a bull market, it feels. Since 2014, prices have gone up every year. Things are finally stabilizing now, which is great because buyers can take a more relaxed approach. They have some time to breathe before making an offer.”
More from U.S. News
Should You Disclose the Climate Risks to Your Home?
How Does Buying a House As-Is Work?
9 Emerging Home Building Trends
Dallas Housing Market Forecast originally appeared on usnews.com
Update 10/02/24: This story was published at an earlier date and has been updated with new information.
