DFW HOME INVENTORY: There are just mind blowing numbers to report for last year in the DFW area. We saw 20 percent more homes built last year, year over year, coming off of a record year in 2020. However, home sales overall were down 4 percent. The reason home sales were down is because of a lack of inventory. An interesting point to note in what we saw towards the end of 2021, was that builders were hitting the breaks on building homes (despite the huge demand). This year, we are already seeing a pull back, too. Again, it is not because of demand. It is simply because of back-log in home deliveries.
North Texas had 3,323 permits filed to build new homes in December 2021, which is down a whopping 27 percent from the year before. So new homes coming to the market are slowing down. Why? Because of the supply chain issues. Getting product is an issue, and then you also have labor shortages. So keeping customers happy is complicated right now because of the severe back-orders on new homes. Hopefully supply chain issues will get back to normal this year. That will help a lot of what we are seeing in the real estate market.
PRICE APPRECIATION: Most of the DFW Metroplex saw 20 percent growth in price appreciation last year. Two-thirds of the DFW Metroplex saw 20 percent plus while the other one-third of areas were at about 10 to 20 percent price appreciation. Those areas were where it was 10 percent instead of 20, is mainly because this is where more new construction was occurring, like in Kaufman County, South of Dallas area. This means there was a little more inventory there, which is why you see a little less price appreciation.
But for most of DFW, we are talking around 100K in price appreciation on average throughout the Metroplex. Those numbers are hard to wrap your head around. They are just astronomical.
NEW CONSTRUCTION: Builders started $16.9 Billion in Residential Construction last year in DFW (a 14 percent increase in home and apartment building from 2020). As for which market is top in construction in the whole country, DFW leads there. But still, the number of homes for sale was actually 42 percent below pre-pandemic levels last year. And that inventory is still 5 to 10 percent lower than the last year before that.
This means, obviously, homes are going fast and over-asking price. Less homes on the market has meant a huge seller’s market.
RENTAL PRICES: Rental prices have also increased tremendously. Not as much as price appreciation, but it’s around a good 15 percent increase. So, the cost of living in DFW Metroplex is going up.
But the good news, we also have the lowest foreclosure rate in decades. This is most likely due to our job opportunities in this area and people going back to work sooner than in a lot of other areas post-COVID closures. So again, for residential, the market was down due to low inventory and low number of transactions, but price appreciation was up significantly.