Dallas, Texas and its surrounding metropolitan area are attracting new residents in droves. The influx is being propelled by job opportunities, climate, and the area’s relative affordability. According to the US Census Bureau, the Dallas-Ft. Worth-Arlington metropolitan area was the eighth fastest growing in the country between 2015 and 2020. That inbound migration continued during the pandemic, to the point that greater Dallas is now the fourth largest metro area in the country, having gained 1.2 million new residents since 2010. Dallas itself is home to 1.3 million people while the metropolitan area is home to over 7.6 million people.
Since the beginning of the pandemic, many people relocated to the Dallas from pricier markets in the northeast and on the west coast. Some of these new residents were freed up by being able to work remotely, while others relocated because of its robust job market. Employment growth in Dallas-Ft. Worth stands at 5.6 percent year-over-year. Greater Dallas-Ft. Worth is home to over 10,000 corporate headquarters, which include major employers such as American Airlines, Exxon Mobil Corp. and AT&T. Greater Dallas is home to the highest concentration of corporate headquarters in the US. Amongst those companies, 22 made the Fortune 500 list in 2021. These factors are probably what led to Dallas becoming ranked by Forbes magazine as the second-best city in the country for business and careers.
Beyond its job market, Dallas has a lot of other attributes that enhance the quality of life for its residents. Locals can appreciate that the overall cost of living is about 50 percent less than coastal markets like New York and San Francisco. Dallas is a great city for sports lovers, with local pro teams the Texas Rangers, Dallas Mavericks, and the Dallas Cowboys. For those who aren’t as enthusiastic about sports, Dallas still has plenty to offer. Dallas has emerged as a world-class food capital, with Bon Appetit magazine naming it the Restaurant City of the year in 2019. Other attractions include the Downtown Arts District, Dallas Symphony Orchestra, and the Texas State Fair.
With so many new residents coming to the area, home prices in Dallas show no sign of leveling off. In November of 2021, the average home price in Dallas had increased by 18 percent year over year. Inventory has remained extremely limited, with only approximately 8200 single-family homes available in a metro area with about 1.9 million single family homes.
The current median sale price of a house in Dallas is $360,000, which is a 20 percent year-over-year increase. Over the past five years, the average home price in Dallas has increased by 78 percent. According to Google trends, the number of people looking for houses in Dallas has never been higher. So far in 2022, that number of people Googling “Dallas homes for sale” sits at a record 4,960 searches per week, about 150 more per week than the 2021 average.
For multifamily real estate investors, Dallas could not be more enticing. With such a large influx of new residents and limited housing inventory, there has been a surge in demand for rental housing. As of November, apartment occupancy for greater Dallas stood at 96.5 percent. According to Rent Café, the average rent for an apartment in Dallas is now $1,474. Between February 2021 and February 2022, rents in Dallas increased by 13.4 percent. Renter-occupied homes in greater Dallas account for 44 percent of occupied housing units. Within the metropolitan area, there were even greater increases in the cities of Plano and Irving, where rents increased approximately 17 percent during the same period.
With people continuing to be drawn to the Dallas area, the region’s multifamily market will offer exceptional opportunities for investment for the foreseeable future.
