Affordable housing crisis hits DFW families hard, no quick and easy solution on the horizon

Fort Worth, Texas – In a climate where economic authorities assert that inflationary pressures are commencing a gradual decline, the lived experience of ordinary citizens tells a starkly different tale, particularly in the context of housing, where prices remain doggedly high and seemingly insurmountable for many.

Homeownership is becoming a dream in Dallas-Fort Worth due to surge in housing costs

In the Dallas-Fort Worth (DFW) region, a surge in housing costs is pushing myriad families to the brink, with homeownership increasingly becoming an unattainable dream. The escalating crisis has prompted local nonprofit organizations to step into the fray, offering insights and solutions for those ensnared in this financial quagmire.

“Ten years ago, the median sales price for a home was $150,000 in the DFW area. Now, it’s upwards of $350,000 and has even gone up to 390 I think at the top of last year. So it is, you know, virtually impossible for working families to be able to enter the market,” said Donna Van Ness, president and CEO of Housing Channel Fort Worth.

With a portfolio of programs aimed at supporting lower-income and working families throughout the entire DFW region, Housing Channel Fort Worth is an essential lifeline. Their comprehensive services encompass free housing counseling, robust financial education classes, and much-needed down payment assistance programs. Furthermore, the organization is actively engaged in collaborations with cities across the metroplex to spearhead the construction of new affordable housing, an endeavor aimed at alleviating the pressures of the current market dynamics.

Yet, these interventions appear to be battling a tide of disillusionment. Presently, the nonprofit is witnessing a disconcerting decrease in class enrollment, a phenomenon potentially attributable to a cocktail of factors, including burgeoning discouragement spurred by rising interest rates and the increasingly constricted pathways to homeownership. This negative sentiment may further be exacerbated by the relentless uptrend in rent, creating a multifaceted dilemma that encapsulates the complexities of the modern housing landscape.

“You know, there’s the home prices have just escalated and a lot of our buyers just can’t compete because one out of five buyers is an investor. So a lot of those investors are paying cash – there’s 10 days [closing period], so it eliminates and causes a barrier for working families to be able to enter the homeownership market,” said Van Ness.

The shortage of available housing is also adding to the competition.

According to our recent report, Dallas-Fort Worth is one of the four areas that are seeing surge in real estate prices due to shortage on the market mostly driven by newcomers. This is now emphasized by Van Ness.

“About 33% of the homes last year on the market were priced at a point that was available to the median income households in Dallas-Fort Worth. So 33% is not a lot,” said Van Ness. “And then if you talk about the low to moderate income households, that’s even less at 11%. So you’ve got 11 of the market that working families can enter the market and that competition is already extremely high with investors.”

Even though things look tough from the current perspective, a solution for that dream home is always possible for prospective homeowners according to Van Ness.

“You don’t necessarily have to buy your dream home right out of the gate. Think about just entering the market – maybe buying something smaller, maybe not in the neighborhood that you really want to live in and just enter the market,” she said. “And I think you will see that appreciation very quickly because it’s a hot real estate market – then you can continue to trade up and buy and eventually get into your dream home in the future.”

In grappling with the unyielding housing crisis in Dallas-Fort Worth (DFW), Donna Van Ness emphasizes the primacy of education as the linchpin for navigating the complex landscape of homeownership.

Dallas-Fort Worth prospective homeowners are encouraged to use all the available tools

Van Ness highlights an array of accessible programs that necessitate a mere $1,500 down payment, complemented by various lender initiatives that furnish additional down payment assistance. Nevertheless, she astutely observes that some cities within the region are attempting to augment the income thresholds on assistance schemes in response to inflationary forces, a move that, lamentably, has yet to find universal adoption.

“I think it’s important that the city councils hear from families and neighborhoods about what’s happening to them and their neighborhoods so that they can prioritize resources and funding to more housing programs,” Van Ness said. “There are the ways that people can enter the market and they’re finite, they’re limited. So we just need the city to understand that a thriving community is one that everyone has the opportunity to build wealth and that it supports the city in so many ways.”

This ethos resonates at the highest echelons of local government, with the Fort Worth mayor earmarking housing as a paramount concern in ongoing budget deliberations. Sources confirm that the city is slated to unveil its affordable housing strategic blueprint to the city council next Wednesday, a pivotal step preceding a potential vote later in the month. Concurrently, Dallas is marshaling efforts to earmark an impressive $200 million for affordable housing within its ambitious $1 billion 2024 bond package.

Peering into the uncertain future, Van Ness proffers a sobering outlook on interest rates, doubting a reversion to the lows witnessed during the pandemic. Expressing candid skepticism about any impending decline in property prices or a hoped-for bubble burst, she counsels wisdom in market entry, specifically targeting areas displaying signs of growth and potential.

“I don’t know that we’ll ever get back into the 3% and 4% years that we enjoyed in the last 10 years. But I do believe that they’re going to decrease hopefully from the 8% and the 7%  that we’re seeing now. However, quite honestly as far as real estate, I don’t think property is going to get any cheaper,” she said. “I don’t think that we will have any kind of bubble burst that people may be hoping for. I think it’s better to always enter the market in areas that are up and coming.”

For those seeking to engage with the resources offered by Housing Channel, a touchstone for support and guidance in these turbulent times, assistance is available via telephone at 817-924-5091 or through their website.