Dallas-Fort Worth (DFW) Housing Market Forecast 2023 – 2024

The Dallas metro area real estate market has slowed down over the past year or so, marked by an increase in the median number of “days on market.” Inventory levels have risen as well, giving home buyers more options to choose from and greater negotiating leverage.

Based on these and other recent trends, we offer the following predictions for the Dallas-Fort Worth housing market extending into 2024:

• Home prices will likely continue to rise through this year and into next, but at a slower pace than in recent years.
• Overall, the number of properties for sale in the DFW area is expected to remain low, which will continue to drive up prices.
• Demand for housing in the Dallas-Fort Worth area will likely remain high, due to the area’s strong economy and relatively low cost of living.
• Steady population growth will continue to bolster the market by increasing buyer demand. The DFW Metro area was one of the fastest-growing metros in the country during 2022.

Dallas Housing Market Forecast Extending Into 2024

Here are some additional forecasts, projections and predictions for the Dallas-area real estate market, provided by other sources:

Zillow predicts that home values in the Dallas-Fort Worth area will increase by 3.6% during the 12-month period ending in April 2024. This forecast was issued in May of 2023, via the company’s website.

At the end of last year, the National Association of Realtors offered a strong forecast for the Dallas-area real estate market through 2023 and into 2024.

The NAR report, entitled “On The Horizon: Markets to Watch in 2023 and Beyond,” offered a top-10 list of housing markets that are expected to “outperform” over the coming months. The Dallas-Fort Worth-Arlington metropolitan area was ranked #3 in this particular report.

According to the authors, DFW has experienced a “growing influx of tech workers” with many new startups moving into the area. They also report that the Dallas real estate market offers more affordable homes and more options for buyers, when compared to many other U.S. cities.

Inventory Rose Substantially Over the past Year

The Dallas-Fort Worth real estate market is currently transitioning from a strong seller’s market toward more “neutral” territory. And inventory growth has a lot to do with this ongoing shift.

Active real estate listings within the DFW metro area have more than doubled over the past year, according to one recent report. This report comes from the researchers at Realtor.com.

In May 2024, Realtor.com published its latest housing market update with data for the nation’s 50 largest metro areas. Among other things, it showed that the Dallas-Fort Worth-Arlington metro had the sixth-highest level of inventory growth from April 2022 to April 2023.

During that 12-month timeframe, the total number of active property listings within the DFW area increased by 131%. In other words, the number of homes on the market more than doubled during the past year or so.

But in Recent Months, Inventory Has Declined

When measured over the past year, inventory levels have increased. But when we look at supply conditions over the past few months, a different picture emerges. Since the start of 2023, supply levels within the Dallas-area housing market have actually declined.

You can see this more recent trend in the chart shown below. It’s based on data provided by the national real estate brokerage Redfin.

There are two important trends to notice in this chart, both occurring on the right side. For one thing, you can see how supply levels within the Dallas-Fort Worth real estate market began to increase sharply in 2022. You can also see how that trend reversed around the start of 2023, with supply levels dropping again.

Ongoing inventory fluctuations play an important role in determining both housing market trends and forecasts for the DFW area. If inventory levels continue to decline into the second half of 2023, it could make the Dallas-area real estate market more competitive for home buyers in 2024.

This is a trend we are seeing in many real estate markets across the country right now, and mortgage rates have a lot to do with it. Over the past three years, the average rate for a 30-year fixed mortgage rose from 3.15% (in May 2020) to 6.5% (in May 2023).

Because of this trend, many homeowners who purchased homes over the past few years have a much lower mortgage rate than the current market rates. This makes them less inclined to sell their homes (even if they wanted to) since they would have to take on a higher rate for their next purchase.

A Slower Real Estate Market Than in Years Past

As of late spring 2023, homes listed for sale in the DFW area spent a median of 40 days on the market. That was an increase of 17 days from a year earlier. This shows that the Dallas-area housing market has slowed down over the past year or so, in terms of the sales pace. In short, it’s taking longer to sell a home these days, partly due to higher prices and mortgage rates.

This overall slowdown has also shifted the negotiating dynamic. In 2023, and possibly into 2024, home buyers in the Dallas-Fort Worth real estate market will have more bargaining power than they have had for quite some time. They will be in a better position to negotiate the sale price, concessions, and other terms of the deal.

But here again, the monthly numbers show a different story. While the median number of “days on market” increased steadily and substantially during 2022, it began to drop again in 2023. In other words, the Dallas real estate market now appears to be accelerating — a trend that could continue through the rest of this year.

The chart below shows the median number of days on market for the Dallas-area housing market, going back to the beginning of 2020. You can see how the median DOM dropped sharply through 2020 and into 2021. This was largely due to a pandemic-fueled surge in home-buying activity and relocation.

But notice the sharp increase in median DOM that began during the second quarter of 2022. That was when the market slowed down again, with homes staying on the market longer.

The next reversal began at the start of 2023, when the median number of days on market began to decline again. This shows a faster pace of home sales. That brings us up to the present, helping to shape our predictions for the Dallas real estate market into 2024.

The bottom line here is that there is still plenty of demand among buyers in the DFW-area housing market, and this will likely continue for the foreseeable future.

Dallas Home Prices Holding Steady in 2023

Home prices within the DFW real estate market have held steady over the past year, at a time when they’re dropping in some cities across the country.

According to a recent statement from Zillow: “The average Dallas-Fort Worth-Arlington home value is $372,654, up 0.3% over the past year…”

Home prices in the Austin area, on the other hand, have dropped by more than 6% over the past year. The main difference between these Texas metros is that Austin became one of the hottest markets during the pandemic, sending home prices skyrocketing. The Dallas market grew more slowly during those years, and did not become as “overheated” as Austin.

Even so, DFW home prices have dipped slightly since the start of this year. You can see this in the following chart, which shows the median home value for this metro area over the past few years (based on Zillow’s data).

Our prediction: the Dallas-Fort Worth real estate market could experience a short-term decline in home values, as the housing market “resets” to a new normal. But this will probably be short-lived.

The most likely scenario is that home values will level off in the near future, and begin to rise at a moderate pace into the second and third quarters of 2023. Continued price appreciation in 2024 appears likely as well.

One of the Best Markets for Buyers in 2023 – 2024

Another recent report suggested that the Dallas-area housing market could become a lot more buyer-friendly over the coming months. In April of 2023, the online home-selling platform Knock ranked the DFW area as the second-best market in the U.S. for finding a home.

They also issued a forecast for the Dallas-Fort Worth real estate market, predicting that it would “strongly favor buyers” by early 2024. The company reports that the local housing scene has shifted away from being a seller’s market and currently favors buyers. They expect this shift to continue into 2024, with home buyers gaining even more leverage and bargaining power.

According to a Dallas housing market forecast published by U.S. News & World Report, home buyers could have an easier time finding a suitable property in the suburbs surrounding Dallas, rather than in the city itself.

To quote their February 2023 forecast:

“The majority of single-family construction in the Dallas market is occurring in the suburbs, where there is available land. The outskirts of the metro area is also where more affordable new construction houses are likely to be. If you’re looking for a new house between $300,000 and $600,000, you’re going to be an hour outside of Dallas,’ explains Damon Williamson, managing partner and principal broker at The Agency in Dallas.”

The authors issued another key prediction for the DFW housing market through 2023 and into 2024. Continued demand from home buyers might mean that this market performs “better than other parts of the U.S.” over the coming months.

Population Growth Increasing the Demand for Homes

Data released by the U.S. Census Bureau in May 2023 showed that the Dallas-Fort Worth-Arlington metro area gained more than 170,000 residents in 2022. That was the biggest population increase for any metro area in the country during that period.

The city of Fort Worth, in particular, led the nation in population growth last year, gaining approximately 19,000 new residents. “Fort Worth in some ways used to be kind of a satellite city of Dallas and now is really a powerhouse in terms of population growth,” said State Demographer Lloyd Potter.

This metro area continues to be one of the fastest-growing regions in the United States, with Fort Worth playing a significant role in driving population growth.

These trends are directly connected to the Dallas real estate market. Forecasts and predictions suggest that the DFW metro population will continue to grow steadily through 2023 and into 2024. This increases the need for housing on both the rental and purchase side, while putting upward pressure on prices.

Disclaimer: This report includes a general outlook and forecast for the Dallas-area housing market into 2024. Such forward-looking reviews are the equivalent of an educated guess and should be treated as such. The publisher makes no assertions about future real estate conditions or trends.