With more inventory and an overall slower pace, the Dallas-Fort Worth housing market has shifted in favor of buyers. As a result, 2025 could be a great time to buy a home in Dallas.
5 Things DFW Home Buyers Need to Know
Here are five important trends home buyers need to know about in 2025:
- Prices: DFW home prices remained flat during 2024 but are predicted to rise going forward. This would enable new homeowners to build equity from day one.
- Inventory: The number of homes for sale across the DFW area has increased significantly over the past two years. This gives buyers more options to consider.
- Pace: The local real estate market has slowed down over the past couple of years, with homes taking longer to sell. This gives buyers more time for due diligence.
- Leverage: With more inventory and a slower pace, home buyers in the Dallas-Fort Worth area currently have more negotiating leverage than in previous years.
- Rates: Mortgage rates dropped steadily during the last few weeks of 2024, and they’re expected to be lower in 2025. This improves affordability for buyers.
Because of these factors, 2025 could be a good time to buy a home in the DFW housing market, especially for those who are ready to make a long-term commitment.
Dallas-Fort Worth Home Price Trends
Home prices in the Dallas-Fort Worth-Arlington metro area remained flat during most of 2024, with very little movement. Now, they appear poised to start rising again, at a gradual pace.
Here’s a summary of DFW home price trends over the past five years:
- Prices rose sharply during the second half of 2020 due to a surge in buying activity.
- Prices continued to skyrocket throughout 2021, as buyers flooded into the market.
- The median home value peaked at an all-time high of $380,000 in August of 2022.
- Home values declined in early 2023 due to a national housing market slowdown.
- Prices flattened during 2024 with little to no movement one way or the other.
- The latest forecasts suggest that DFW home values will rise gradually in 2025.
Of course, home prices aren’t the only consideration when deciding if it’s the right time to buy. So let’s zoom out and look at the bigger picture, with some frequently asked questions.
Frequently Asked Questions From Buyers
When people ask if 2025 will be a “good year” to buy a home in Dallas, they’re really asking a series of questions relating to current and projected market conditions.
Here are some of the most important ones:
1. Does the DFW housing market currently favor buyers or sellers?
Generally speaking, the Dallas-Fort Worth (DFW) housing market has shifted from a strong seller’s market to a more balanced market. This transition is partly due to inventory growth, higher prices, and weaker demand among buyers.
It’s not a classic buyer’s market. Sellers still have plenty of room to negotiate. But conditions have definitely improved from a home-buying standpoint.
Starting in late 2022, the percentage of homes that sold for more than asking price began to drop steadily. By late 2024, only a smaller percentage of properties were selling above the list price.
These and other trends show that negotiating leverage has shifted from sellers to buyers, to some degree.
2. Are home prices expected to rise or fall in 2025?
Forecasts for the DFW housing market predict that home values will rise in 2025. But these predictions vary widely.
In December of 2024, Realtor.com predicted that the median sale price for existing single-family homes in the Dallas-Fort Worth area would rise by around 9% during 2025.
In contrast, researchers from Zillow recently predicted that the median home value for this metro area would rise by a mere 1% over the next year or so.
Here at the Home Buying Institute, we lean toward the lower end for such forecasts.
But one thing seems certain. Dallas-area home prices are unlikely to surge or skyrocket again anytime soon, as they did during 2021 – 2022. So there’s less urgency for buyers.
Also, home buyers planning to stay put for a while can take comfort from knowing that Texas home values tend to hold up well over time.
3. What is the inventory of homes like in Dallas?
From an inventory standpoint, the Dallas-area housing market has become a lot more buyer-friendly over the past two years.
At the start of 2025, this metro area had about a 3.8-month supply of homes listed for sale. That’s a big improvement from a record low of 1-month supply seen during the pandemic.
Recent supply growth has made the market a bit more balanced, while giving buyers a better chance of finding a suitable home within budget. It’s good news for house hunters.
4. What will mortgage rates do in 2025?
Mortgage rates were dropping toward the end of 2024, averaging around 6.5% for a 30-year fixed-rate mortgage. As for 2025, many experts believe that rates will decline a bit further, bringing more buyers into the market.
According to a November 2024 report from Freddie Mac:
“But as we get into 2025, we anticipate that rates will gradually decline throughout the year. The expected decline in mortgage rates in 2025 should loosen some of the rate lock-in effect for existing homeowners, offering more inventory in the market.”
5. How is the Dallas job market performing right now?
Overall, the Dallas-Fort Worth job market is strong, with steady employment growth and a relatively low unemployment rate.
This region of Texas benefits from a mix of sectors including technology, healthcare, finance, and professional services. The DFW job market experienced steady growth in 2024, outpacing national averages.
As of November 2024, the Dallas-Fort Worth-Arlington metro area had an unemployment rate of 3.9%, which was slightly lower than the national unemployment rate.
Note: Home buyers should carefully consider their current employment situation and the likelihood for continued employment, before making a purchase.
6. How competitive is the market for home buyers?
The level of competition among home buyers has eased over the past few years. Overheated bidding wars have become increasingly rare and even nonexistent in some local markets.
Inventory growth has had a lot to do with this. With more properties available, buyers don’t have to compete as fiercely with one another. The market is moving at a slower pace as well, giving house hunters more time for inspections and other due diligence.
However, some forecasters expect the DFW housing market to accelerate during 2025. So home buyers might want to consider making a purchase sooner rather than later, to get ahead.
7. Is it cheaper to buy or rent a home in the Dallas area?
According to recent data, it’s currently cheaper to rent a home in the Dallas area compared to buying. The average monthly payments on a median-priced home are significantly higher than the cost of renting a similar property.
A 2024 report from Realtor.com provided the following data points:
- Average monthly cost of buying: $2,788
- Average monthly cost of renting: $1,481
- Monthly savings for renters: $1,307 (88.3%)
This dynamic will likely persist throughout 2025 as well, with renting being the cheaper option.
Brandon Cornett
Brandon Cornett is a veteran real estate market analyst, reporter, and creator of the Home Buying Institute. He has been covering the U.S. real estate market for more than 15 years. About the author