As demand from first-time buyers decreases, bidding wars across the Texas housing market will become less frequent. According to the Knock Buyers and Sellers Market Index, the number of homes sold in the 100 largest housing markets in October was half that of last year. This could give homebuyers more power, but experts say that high interest rates are preventing a true buyer's market.Texas has been one of the best long-term real estate investments in the United States over the past decade. The Dallas Fed's Texas Business Cycle Index reported 1% growth in the Texas economy in July compared to June (SAAR).
While home sales have slowed, this is more likely due to a lack of supply than a lack of demand. Over the past decade, home prices in Texas have increased 99.56 percent, equivalent to an annual home appreciation rate of 7.15 percent, according to data compiled by NeighborhoodScout.The Texas consumer confidence index declined after the April rally, as consumer fears of inflation and the Fed's interest rate hikes dissipated purchasing power. The economic outlook is putting downward pressure on Texas companies, according to the Dallas Federal Reserve's annual employment forecast. According to the most recent report from the Texas Real Estate Research Center at Texas A%26M University, record prices and rising mortgage rates deterred buyers.
The average number of days in the market (DOM) in Texas remained low at 34 days, indicating a continuing imbalance in trading power.Perdue says he expects prices to come down, but not much in the Dallas-Fort Worth area over the next year. According to Zillow, the typical value of a mid-priced property in Texas has risen by 19.8% over the past twelve months. The lack of inventory continues to inflate house prices in Texas for now, but many analysts predict that the rate of appreciation will slow compared to the past two years.Since Texas' unemployment rate is often equal to or lower than the national average, an influx of employees from other states could explain its high rate, not a weak labor market. Neighborhoodscout's last quarterly appreciation rate in Texas was 7.53 percent, which is equivalent to an annual appreciation rate of 33.67 percent.
Texas ranks first among the 50 states and the District of Columbia in terms of percentage increase in paid non-agricultural employment over the past 12 months. Texas' leading economic index (a measure of future changes in direction in the economic cycle) ended its post-pandemic expansion streak and closed lower for the third consecutive month.
