Dallas, Texas – The residential property market in the Dallas-Fort Worth metro area has witnessed a marginally accelerated reduction in condo prices in contrast to single-family houses, according to the most recent data provided by Zillow.
Dallas area residents are more interested in condos due to rising real estate prices
This trend aligns with an overarching shift in buyer preferences in the Dallas metro region. Prospective homeowners have pivoted towards condominiums and townhouses, primarily driven by the escalating expenses associated with residential real estate. This insight was shared by Hannah Jones, an analyst at Realtor.com, during a conversation with Axios.
The nationwide real estate trends support Jones’s observation, with prices in the condominium and townhouse segment escalating at a significantly brisker pace in comparison to single-family homes, as per data from the real estate conglomerate.
Underpinning the burgeoning allure of condominiums is the strategic choice by young first-time homebuyers seeking financially viable options and older homeowners keen on transitioning to a lifestyle unburdened by maintenance responsibilities, according to real estate market analysts.
Condo sales in Dallas, Fort Worth area have increased, but prices slightly went down
Come May, the average condo in North Texas exchanged hands for roughly $272,000, which marks a 9.4% decrease from the prior year. In contrast, single-family homes traded at about $401,000, representing a 7% year-on-year drop.
Interestingly, the condo market experienced a 12% surge in sales volume this May, compared to the same period last year. In contrast, the sales of single-family homes registered a 12% decline over the same duration.
Meanwhile, inventory of both condo and single-family homes has seen a significant decline since the year before
The market inventory of both condominiums and single-family homes has seen a significant decline since the previous year, further limiting options for prospective buyers.
Adding to the tightening inventory, the overall active listings of condos plummeted by a staggering 45% this June, as compared to the pre-pandemic figures from June 2019. Simultaneously, listings of single-family homes fell by nearly 37% over the same timeframe.
Remarkably, nine out of ten mortgage-bound homeowners in Texas are subjected to a rate below 6%, effectively deterring them from relocating and constricting the available housing choices for new buyers.
Condo and single-family prices in some Texas cites have skyrocketed
While the Dallas region has been insulated from acute condo price surges, other Texan cities haven’t been as fortunate. Notably, the median condo price in San Antonio has skyrocketed by nearly 31% over the past year, juxtaposed with a near 6% price dip for single-family homes.
The city of Austin, too, has not been immune to this trend, with its median condo prices surging by nearly 20%, as opposed to a 17% price increment for single-family houses over the last year.
One must bear in mind that the cost of condo ownership is not limited to the purchase price alone. Homeowners association fees, which vary from one establishment to another, significantly influence the final cost.
Adding another layer of complexity to the housing market landscape, the Federal Reserve has just announced a quarter-percentage-point hike in interest rates, catapulting it to a peak not witnessed in the past 22 years, and further exacerbating the prevailing high mortgage rates.
If you are thinking about investment in real estate, you should read our Dallas real estate market report.