Tuesday, September 22, 2015
Young buyers, empty nesters push D-FW condo sales to record high
With summer winding down, 2015 will go in the record books as the hottest housing market ever in North Texas.
And it’s not just houses that are selling at unprecedented levels.
More condominiums have changed hands in the Dallas-Fort Worth area this year than previously recorded.
In August alone, real estate agents sold more than 660 condos — the largest one-month total so far.
The rise in sales has been across all prices and includes everything from small studios to the largest luxury high-rise units.
“I think we are in the best demand-driven condo market we’ve ever seen in Dallas,” said housing analyst Mike Puls with Foley & Puls. “I see this trend continuing because the demographics are there and growing fast.”
Puls said the condo market is being driven by a combination of older folks exiting houses for something smaller and young professionals who don’t want to keep shelling out thousands of dollars a year in apartment rent.
“Some of these condo buyers are selling their houses and in some cases have made a big profit,” he said. “Where are they going to put that? In the stock market?
“The don’t want the stairs and maintenance of a house and they want something they can lock up and go.”
Sales up 20%
Puls’ research shows that more than 50 high-rise and luxury condos have sold in the D-FW area this year with an average sales price of about $2.3 million. That’s about 10 times what the average North Texas pre-owned house sells for.
Sales of these units are up about 20 percent this year, according to Puls.
“It’s been a good year for this market,” said agent Sue Krider with Allie Beth Allman & Associates. “The same as with houses, there is a struggle for enough inventory to sell.”
Krider said she’s seen a steady stream of baby boomers and empty nesters looking at condos in Dallas.
“When I do open houses — no matter what price point — they are coming from Highland Park, Frisco, Plano,” she said. “They want to see what they can get for their money and if they can downsize that much.
“It’s a lot of young people, too. I love the increases in apartment rental rates.”
Joseph Gullotto with Dave Perry-Miller & Associates said a shortage of condos to sell has held back the market.
“There is just not a lot to buy,” Gullotto said “People like the low maintenance, and they want to live in the city.
“There’s not a lot of new condo construction.”
In previous strong condo markets, Dallas saw lots of apartments converted to ownership. But that hasn’t happened as much this cycle because most of the apartments are owned by public companies and institutional investors.
Plus, job growth in North Texas is fueling strong increases in apartment rents.
“The landlords don’t have much incentive to convert,” Gullotto said.
One large condo tower is being constructed in Uptown. The 33-story Bleu Ciel is being built near the entrance to the Dallas North Tollway and will have more than 150 units.
Another high-rise condominium project planned on Turtle Creek by Canadian developer Great Gulf Homes is planned with about 60 units.
A 150-unit condo tower in the works at the $2 billion Legacy West development in Plano is getting early buyer interest.
The 30-story tower will be just east of where Toyota Motor Co. is building its new North American headquarters.
“We are seeing amazing response on Legacy West,” said marketing agent Al Coker. “We are just now getting to where we have floor plans.
“We already have 55 reservations.”
Coker said he’s just wrapping up sales of a small condo project in Oak Lawn that traded in “record time.”
“I wish I had 10 more of them.”
Steve Brown/Dallas Morning News