Home prices in the Dallas area have declined slightly over the past year, and that trend could continue for a while longer. But the market will rebound eventually.
One likely scenario is that home values will begin to creep upward in late-2025, with a period of sustained but gradual price appreciation thereafter.
Here are five things to know about these trends:
- DFW area home prices dropped 0.6% over the past year, according to Zillow.
- As of April 2025, the median home value for the metro area was $370,000.
- Most cities in the area experienced slight price declines over the past year.
- Frisco, Texas is one of the notable exceptions where values have risen slightly.
- Several factors are putting downward pressure on Dallas-area home prices.
DFW Home Prices Dropped Over the Past Year
For the rest of 2025, we expect to see additional (but shallow) price declines for most DFW metro area cities. This could keep some home buyers on the sidelines a bit longer, as they watch and wait for the “bottom” of the market.
But the Dallas real estate market will eventually rebound, with prices turning north again. The DFW metro area has strong economic fundamentals and a decades-long history of steady home value appreciation.
For now, however, Dallas area home prices continue to drop as of spring 2025.
Here are the median home values for the seven most populous cities in the DFW metroplex, as of spring 2025. The percentages show how they’ve changed over the past year.
- Dallas: $306,959 (-1.1% 1-yr)
- Fort Worth: $299,339 (-1.1% 1-yr)
- Arlington: $313,037 (-1.0% 1-yr)
- Plano: $516,740 (-0.4% 1-yr)
- Frisco: $678,458 (+0.8% 1-yr)
- Irving: $341,592 (-0.2% 1-yr)
- Garland: $295,883 (-1.3% 1-yr)
As you can see, home prices in most major cities fell slightly over the previous 12 months, with the exception of Frisco.
Home Values Might Have Further to Fall
No one can predict future real estate trends with complete accuracy. There are too many variables involved, many of which we cannot foresee.
But when considering local market conditions and the broader economic picture, it seems that Dallas home prices might have further to fall in 2025 before rebounding.
Our outlook is that DFW home values will cease falling and level off in late-2025, and then return to a gradual rise going into 2026.
In the meantime, some Dallas-area home buyers might adopt a wait-and-see approach, looking for signs of price stabilization before choosing to enter the market.
Factors Putting Downward Pressure on Prices
Here are four factors that could cause DFW house values to decline further over the coming months.
1. Stubborn Mortgage Rates
Last year, many forecasters predicted that mortgage rates would drop steadily during 2025. While rates declined a bit at the start of this year, the general consensus now is that they will stay in their current range for the foreseeable future. Higher rates eat into affordability and reduce demand for homes, weakening prices.
2. Economic Uncertainty
Recent surveys have shown that consumers are becoming increasingly pessimistic about the economy and their place within it. Rising prices, trade wars, and the threat of another recession top the list of reasons why. This is causing some potential home buyers to stay on the sidelines, weakening prices.
3. Increased Inventory and Oversupply
According to data from Realtor.com, active real estate listings in the Dallas metro area rose 38% in March 2024 compared to a year earlier. There’s more inventory now than before the pandemic. This gives buyers additional leverage to negotiate the sale price downward. It also makes sellers more inclined to compromise and reduce their asking prices.
4. Affordability Ceiling Reached
Unprecedented home-price growth from 2020 to 2022 pushed affordability to historic lows in many markets. But wages haven’t kept up. There’s a limit to how much buyers can pay, regardless of their willingness. This affordability crunch acts as a natural brake on further price gains, making markets vulnerable to stagnation or declines if other negative factors emerge.
What Makes Dallas a Stable Housing Market
And now for the upside…
While the Dallas real estate market faces some headwinds in 2025, it also has a long history of steady and stable price growth going back decades.
This market has never experienced a prolonged or major downturn in home values, not even during the Great Recession of 2008.
Here are some factors that contribute to this market stability:
1. Strong and Diversified Economy
The DFW region has a strong and diverse economy. It’s a major hub for energy, finance, technology, defense, logistics, healthcare and more. This diversification reduces the area’s reliance on any single sector, making it more resilient to economic downturns.
2. Consistent Job Growth
Over the last two decades, hundreds of major companies (from Toyota and FedEx to Charles Schwab and Oracle) have moved regional or national headquarters to DFW. That steady influx of high‑paying jobs draws new residents and keeps demand for housing high.
3. Relatively Affordable Cost of Living
Compared to many other major metropolitan areas in the United States, the Dallas-Fort Worth area offers a relatively affordable cost of living, including housing. This makes it an attractive destination for individuals and families relocating from more expensive areas.
4. Significant Population Growth
DFW is one of the fastest-growing metropolitan areas in the nation. This population growth (driven by both domestic and international migration) creates a continuous demand for housing while bolstering home prices.
A Market “Crash” Scenario Remains Unlikely
Multiple overlapping factors are putting downward pressure on home prices in the Dallas area, and that could continue for much of 2025.
But that doesn’t mean DFW will experience a full-on market crash later this year, or even a significant and prolonged downturn.
The U.S. as a whole just came out of a post-pandemic price correction, during which home values dipped in most cities. Now, in 2025, home prices are settling into a “new normal.”
The point of this report is to show that there are currently a lot of factors working against future home-price growth. So it’s reasonable to predict that prices will remain flat or dip slightly for the rest of 2025.
We also have to remember that local housing markets can vary significantly, even within the same metro area. So home buyers should conduct plenty of localized research before entering the market.
Disclaimer: Real estate market forecasts involve uncertainty and should not be considered a guarantee of future price trends.
Brandon Cornett
Brandon Cornett is a veteran real estate market analyst and reporter. He has been covering the U.S. real estate market for nearly 20 years. More about the author