Real estate listings in the Dallas-Fort Worth area have seen a spike in recent months, causing many homeowners to fear a collapse in the housing market is imminent, The Dallas Morning News reports.
DFW home listings increased 41.6% over the previous year for the week of May 21, the fifth straight week of increases, according to Realtor.com. Prior to those gains, the website reported a decrease in the number of houses available in the area dating back to March 2020, the start of the COVID pandemic.
Mike Reddell, senior executive vice president and managing director for Douglas Elliman Real Estate in Dallas, told the DMN that if he were in a position to sell his house right now, he would be tempted to do so. He also stated:
“Sellers have been hearing for about two years what an amazing time it is for them to sell… and they’ve seen their equity just grow like crazy. With the stock market being wobbly and mortgage rates rising, I think sellers that have been thinking about this for a while, more of them are pulling the trigger and putting the house up for sale.”
Realtor.com noted that the overall number of houses for sale nationwide has increased 9% in recent days.
In addition to the number of houses on the market, the average sale price has also skyrocketed. According to a report by realty company Re/Max released this month, the average sale price of a home in the Dallas-Fort Worth area increased nearly 40% over the previous year. The report lists the median sale price for a DFW home in April at $362,782.
Todd Luong, a Re/Max realtor in the Dallas-Fort Worth area, told The Dallas Business Journal in an email that one of the biggest reasons for the increase was corporate relocations.
As large companies move to a new area, they bring with them workers who need housing. Luong stated that the amount of office space in Dallas increased by over 55 million square feet in the past decade, an expansion second only to New York City.
Industrial space in the metropolitan area also grew by 230 million square feet, which has led to a sharp increase in the number of jobs available and, by extension, the number of workers from other cities relocating for those jobs.
The last major housing crisis in the U.S. took place in 2008 as a result of a nationwide increase of subprime mortgages being issued to homeowners who ended up not being able to repay those loans.
Still, not every market analyst believes a crash is imminent.
Steve Fernandez of Strategic Fortunes claims that rising rent costs will drive current renters into purchasing homes instead of renting, thus allowing supply to meet demand and preventing a crisis.