“We all know what is happening, and the whys, but I don’t see any change in the trend for the next 3 years,” stated Raymond Campbell, owner of Dr Cash Home Buyers, an investor group of home buyers in Dallas. He is referring to the escalating prices for existing and new homes in the Dallas metro area. As of August 2018 Realtor.com is reporting the median LISTING prices for existing homes was $389,000. Listing prices were above $400,000 in April, May, and June of 2017. The median price is the point where half the values are below it and half the values are above it. Listing prices are not final selling prices but in a hot real estate market selling prices can exceed listing prices due to buyer competition.
“Demand is the key factor for the steady rise in home prices. The Dallas metro area is a growing economic area and population growth spurs this housing demand. The latest statistics show the Dallas-Fort Worth area is adding almost 100,000 new jobs per year. So they have to find either existing housing that is for sale or rent, or new housing. And new housing has been trying to catch-up with demand for some time,” commented Mr. Campbell.
House buyers in Dallas fear that rising prices for housing will choke the economic progress of the region to a standstill. Recently the Dallas area has fallen in the rankings of most livable cities in the USA. For years the Dallas area had been ranked in the top ten livable cities but it has recently fallen to number 48. The reason for the drop is primarily attributed to the steep rise in affordability of housing in the DFW area.
New homes are offered in all price ranges but home builders struggle to offer them under $200,000. They must contend with rising prices on almost everything including land, materials, and labor. The government’s recent trade tariffs are expected to add more costs to lumber, nails, sheetrock, equipment, and prefabricated housing components. And the country’s current crackdown on immigrants has created fear in the foreign-born labor pool that provides most of the construction labor. Home builders are now facing an acute labor shortage for construction workers.
Given all of these factors, Zillow projects the cost of housing to increase over 11% per year for the next two years.
Dr Cash Home Buyers
1341 W Mockingbird Ln, Suite 600W, Dallas, TX 75247