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Friday, November 08, 2013
Homebuilding forecast: Rise in D-FW starts will moderate in 2014
North Texas new home prices are at a record level. (Residential Strategies)
Dallas-Fort Worth home starts are expected to be up almost 20 percent this year, thanks to a growing local economy and strong buyer demand.
But the rate of home start growth is likely to be a bit slower in 2014, one of North Texas’ top housing analysts predicts.
Residential Strategies Inc. anticipates that home starts in the D-FW area will total about 21,000 this year – up from just under 18,000 in 2012.
In 2014, homebuilders are expected to start about 24,500 units, Residential Strategies principal Ted Wilson told builders meeting Thursday morning.
While the increase is healthy, it’s not at the same pace as in the last couple of years, Wilson said.
“There has obviously been a little bit of a pause in the new home market,” Wilson said. “What we have heard from the builders is the higher mortgage rates and house prices have converged.
“That’s manifested itself in slower, more seasonal sales.”
Wilson said that prices for a 3,200-square-foot new home in the most popular North Texas neighborhoods have risen by about 18 percent in the last two years.
And this year’s increases in mortgage rates have pushed the monthly cost of paying for that new house even higher.
“For the last few years, housing was on sale we had a big discount,” Wilson said. “Now the sale is over.
“Eventually the market will recharge itself.”
Wilson is hoping that with North Texas’ booming employment growth and expanding economy, homebuyers will be able to handle the higher housing price tags.