Rents and home prices are on the decline in Dallas-Fort Worth, reflecting a market that’s still cooling off after it was on fire in the years following the pandemic.
Median home sales prices in the region were down 4.5 percent year-over-year last quarter, according to the National Association of Realtors. Moreover, the rental growth rate in DFW was less than 1 percent for the first time since the financial crisis of 2008, the Dallas Morning News reported.
The median sales price in the second quarter was $389,000 in the region, below the national average of $402,600. Home prices fell 2.4 percent nationwide during that period. Among 221 U.S. metros, DFW was one of 93 that experienced a price decrease.
The drop in sales prices indicates a more balanced market, as home values in DFW and other Texas metros seemed like they would skyrocket to no end during the post-pandemic housing boom.
As of last April, prices in North Texas had increased 45 percent over a three-year stretch. The median sales price reached a record-high of $435,000 in May and June, before dropping considerably in the fall. Hiked mortgage rates, lower inventory and economic uncertainties have shifted DFW to more of a buyer’s market.
Elsewhere in Texas, the median sales price in Houston dipped 2.5 percent at the mid-year point compared to the same period last year, and San Antonio’s dropped 4.4 percent. Austin’s median sales price of $496,300 was the highest in Texas, despite prices declining there as well.
DFW’s rental market is also slowing. In the Dallas area, rents increased just 0.1 percent year-over-year in July, and they fell 0.1 percent in the Fort Worth area, according to RealPage economist Jay Parsons.
Akin to the region’s housing market, rents were soaring due to an influx of new residents, driving the supply-and-demand balance out of whack. Builders have capitalized on the population growth, though, as DFW leads the nation with over 74,000 apartments in the pipeline. Thus, the added supply has pushed rental rates down.
However, rents have gradually increased month-to-month in 2023, creeping up to an average of $1,549 per month — a sign that demand is still strong in DFW. Roughly 5,500 units were leased last quarter, which was the most since over a year ago. The occupancy rate was almost 94 percent, the outlet said.
—Quinn Donoghue
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