Home prices stagnate in Texas as supply soars

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Today's newsletter is 450 words — a 2-minute read.

1. Texas cities at the forefront of built-to-rent craze

According to a report by RentCafe, the Houston area has 4,836 rental homes under construction, ranking third in the nation behind Phoenix (7,236) and Dallas (6,841).

Last year, developers across the nation completed a record-breaking 27,500 single-family rental homes, marking a 75 percent surge from 2022 and a 175 percent increase from 2021.

This surge can be attributed to factors including the pandemic-fueled remote work era, Millennials reaching prime nesting age, and challenges in home buying, like high mortgage rates.

2. Home prices stagnate in Texas as supply soars

Texas and Florida have been building more homes than anywhere else in the country, partly to accommodate the flood of newcomers that showed up during the pandemic homebuying boom. But the boom is over, in part because many people have been priced out. Now, homes are sitting on the market, and price growth is stagnating.

• Supply: Of the 10 metro areas that posted the largest year-over-year increases in supply, six are in Florida and two are in Texas: McAllen (+25%) and Dallas (+20%).

• Price drops: Of the 10 metro areas where sellers were most likely to cut their list prices, five are in Florida and two are in Texas: Houston (33%) and San Antonio (33%).

• Prices: Median sale prices fell from a year earlier in three metros, one of which is in Florida and one of which is in Texas: San Antonio (-0.3%). Prices climbed least in Austin (0%), El Paso (0%).

• Speed of sales: Of the 10 metros that saw the biggest upticks in median days on market, two are in Florida and two are in Texas: McAllen (20 days), San Antonio (10 days).

3. Catch up quick

💸 Soaring insurance costs could force house prices to fall—and some homeowners to forgo coverage. (Realtor)

📈 Top areas in Texas poised for largest home price growth. (Norada)

🏘️ Despite year-over-year declines, Houston ranks third in U.S. for home sales. (Houston Agent Magazine)

🧐 What $340K gets you in Texas' major real estate markets. (Axios)

4. Dallas industrial valuations surge 53-70%

Dallas County's industrial property owners and tenants are grappling with an unprecedented surge in valuation estimates, with increases ranging between 53 and 70 percent over the past year, as reported by Bisnow.

The dramatic valuation increases announced by DCAD have sparked widespread concern among property tax consultants and owners alike, who argue that these adjustments fail to reflect the current market reality.

With transaction volumes dwindling, leasing activity slowing, and vacancies on the rise since 2022, the industrial market in DFW has been anything but robust.

5. Historic Houston Swift refinery building to be redeveloped

Two local developers announced their plans to renovate the historic Swift warehouse complex into a refurbished space that will house retail stores, offices, and up to six restaurants.

The complex is located at 621 Waverly along the Heights Hike-and-Bike Trail and nearby M-K-T, another mixed-use project redeveloped by Radom Capital and Triten Real Estate during the pandemic. The two have teamed up again on the Swift refinery complex, which is expected to start construction later this year

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