By Brandon Cornett | January 18, 2019 | © HBI, all rights reserved
Recent forecasts for the real estate market in Dallas, Texas suggest that home prices in the area could rise faster than the national average in 2019. A separate forecast from Zillow ranked Dallas as one of the top ten “hottest” housing markets of 2019.
Bold Outlook for Dallas Housing Market in 2019
At the start of 2019, the median home value for Dallas, Texas was around $201,000. (The median for the broader DFW metro area was a bit higher.) That was a gain of more than 13% from a year earlier, according to data collected by Zillow.
Predictions from housing analysts point to continued home-price growth throughout 2019. In fact, the Dallas real estate market is expected to outperform the nation this year, in terms of annual home-value appreciation.
Given the current rate of appreciation, it would not be surprising to see the median house price in Dallas rise somewhere between 7% and 10% over the next year.
Zillow’s research team recently predicted that the median value in Dallas would climb by 11.2% over the next 12 months. That was a much bolder forecast than the one they issued for the nation as a whole, which predicted 6.4% growth.
Related: 8 more markets heating up
Housing Supply on the Rise
Inventory is another important trend that could shape the Dallas-area housing market in 2019. This year, home buyers across the metro area could have more properties to choose from.
At the end of 2018, the Dallas real estate market had more than a 4-month supply of homes for sale. That was a higher level of inventory than most metro areas across the U.S., and also higher than the national average during that same timeframe.
The key takeaway here is that housing inventory in Dallas (i.e., the number of homes listed for sale) increased during the latter part of 2018. As a result, buyers who enter the market this year should have more options when it comes to choosing a property.
Dallas Makes Zillow’s “Hottest” List
In January, Zillow published a forecast that included what they felt would be the ten “hottest U.S. housing markets for 2019.” Dallas was ranked at number seven on that list.
To create their “hot list,” Zillow examined a number of factors for the nation’s 50 largest metro areas. They then combined these variables to create a “hotness” score. They looked for metro areas with strong income growth, growing populations, and low unemployment — among other factors.
San Jose, California was ranked number one in the hottest markets forecast. Orlando and Denver rounded out the top three. Dallas came in at number seven.
A Cooling Trend Could Prevent Affordability Issues
The Dallas real estate market is something of a paradox right now, as we move into 2019. Home prices in the area continue to rise faster than the national average. At the same, however, there is clearly a cooling trend taking place.
Paige Shipp, regional director at MetroStudy, recently told The Dallas Morning News:
“Dallas-Fort Worth, the nation’s top new home market, is slowing from a frenzied, overheated pace to a more stable, normalized market. Builders and developers are hard at work delivering product to meet the strong demand for affordable new homes.”
Dallas currently leads the nation in terms of new-home construction, according to MetroStudy and other sources. There were nearly 35,000 housing starts in the DFW area during the third quarter of 2018, more than any other metro. (A “housing start” is the beginning of construction for a house.)
If inventory continues to grow in this market — as expected — it will likely lead to smaller home-price gains in the future. And that’s probably a good thing. When house prices rise at a much faster pace than local wages and income, it can create affordability problems. So a cooling trend could actually be beneficial at this point.
Disclaimer: This article includes housing market predictions for the Dallas-Forth Worth metro area in 2019. They were provided by third parties not associated with the Home Buying Institute. Real estate forecasts are the equivalent of an educated and are far from certain.
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