Already enjoying a stellar run in recent years, the Dallas-Fort Worth real estate market is about to really take off.
DFW is expected to be one of the top 10 real estate markets to outperform in the United States in 2023, according to Lawrence Yun, chief economist and senior vice president of research with the National Association of Realtors (NAR).
NAR anticipates that the U.S. will experience 4.78 million existing-home sales next year, a 6.8% drop from 5.13 million in 2022. Median home prices are expected to rise to $385,000, a modest 0.3% increase. This represents a massive drop from the 9.6% appreciation in U.S. home prices this year.
Not all markets are expected to perform the same, though, said Yun.
“Half of the country may experience small price gains, while the other half may see slight price declines,” he warned. “However, markets in California may be the exception, with San Francisco, for example, likely to register price drops of 10–15%,” according to Yun.
To rank the metro areas, NAR assessed each using 10 factors and compared them to the rates witnessed at the national level. Beating national-level metrics in any of the following 10 areas contributed to a higher score.
- Housing affordability
- Percent of renters who can afford a median-priced home
- Job growth
- Information industry job growth
- Share of information industry in the local GDP
- Net migration
- Share of teleworking jobs
- Population growth
- Housing inventory growth
- Housing supply versus demand
After assessing 179 metropolitan areas, Atlanta-Sandy Sprints-Marietta, Georgia, was ranked as the number one market to watch next year. It was the only metro area to beat the national average on all 10 items. Raleigh, North Carolina, followed in second place.
- Atlanta-Sandy Springs-Marietta, GA
- Raleigh, NC
- Dallas-Fort Worth-Arlington, TX
- Fayetteville-Springdale-Rogers, AR-MO
- Greenville-Anderson-Mauldin, SC
- Charleston-North Charleston, SC
- Huntsville, AL
- Jacksonville, FL
- San Antonio-New Braunfels, TX
- Knoxville, TN
DFW landed at number three on the list, attributed to the city’s expanding tech industry and relatively affordable housing.
“Dallas-Fort Worth has experienced a growing influx of tech workers. This is another emerging tech in the U.S., with many new start-ups moving in this area. Not only is housing more affordable than nationally, but this area provides more options to buyers,” said the study.
DFW beat the national average in all 10 categories except the growth of information jobs.
While the report’s predictions are encouraging for DFW, the metro area continues to face challenging headwinds amid high interest rates. While it remains robust, housing activity has softened in the metroplex in recent months.
“It currently takes about 18 showings before one of our listings will sell … If you do the math there, you will quickly see that the days of sellers getting 20-plus offers on the first weekend are long gone now,” said RE/MAX DFW Associates Agent Todd Luong.
Still, others, like Jörg Mast, executive vice president of capital markets at Colliers International, are excited about DFW’s 2023 prospects.
According to Mast, he is witnessing “excellent” prospects for the multifamily housing market in the city. He believes that DFW is transitioning to the next phase of expansion, with developers increasingly building projects further from the city center to accommodate demand.
“Ten years ago, no multifamily developer or investor would have even contemplated building in these locations. This proves that Dallas-Fort Worth has, yet again, reached another growth stage,” said Mast.