The North Texas housing market is offering some encouraging signs for homebuyers in 2024.
Dallas-Fort Worth saw increased housing market activity during the last month of 2023 as mortgage rates eased into the mid-6% range after topping out two months prior.
Overall, DFW home sale transactions rose 5.9% in December following three consecutive months of declines, according to the latest RE/MAX National Housing Report. Meanwhile, new listings jumped by more than 15.3% year over year, marking the largest increase since January 2023.
Despite interest rates leveling out toward the end of 2023, the metroplex was not immune to a 5.8% drop in home sales over the previous year, according to Todd Luong, a realtor with RE/MAX DFW Associates.
“As interest rates came down from the record highs of October, Dallas-Fort Worth managed to see a small gain in median home prices for 2023 but ended the year with fewer real estate transactions than in 2022,” Luong told The Dallas Express.
Although total home sales declined in 2023, Luong said it was not entirely due to higher mortgage rates in the United States.
“Housing affordability was still a major challenge for many buyers, especially for first-time home buyers,” he said.
Overall, the report shows that DFW’s median home sale price was about $387,700 in December, with the median home price up slightly at 0.7% year over year. Luong suggested that part of the reason for the stubbornly high home prices in the area was due to low inventory levels.
“With so many existing homeowners paying an interest rate in the 3% range for their current home, it is hard to expect them to walk away and sell their homes anytime soon. As a result, you just can’t expect the level of pre-owned inventory to increase by very much this year,” he explained.
Since the market for pre-owned homes remains tight due to homeowners not wanting to sell, many would-be buyers have been forced to pursue new home builds as an alternative.
“New construction home sales in Dallas-Fort Worth have benefited significantly because of the low inventory levels of pre-owned homes. In fact, builders here sold a record number of new construction homes in 2023,” Luong told The Dallas Express.
Because of this strong demand, new construction home starts in DFW have risen by as much as 50%, according to Luong. At its current pace, he said DFW “will likely lead the entire nation in new construction of single-family homes.”
This is despite the notoriously difficult permitting process in Dallas.
