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North Texas new home sales climbed last month and pending sales are also up, signaling continued strength in the housing market moving into the summer despite inventory challenges, rising mortgage rates, inflation and other headwinds.
New home prices also continue to climb, setting another record last month.
Dallas-Fort Worth new home sales rose for the third straight month in May, according to the latest report from Dallas-based HomesUSA.com. The three-month moving average of DFW new home sales shows last month’s sales reported to Multiple Listing Services increased to 1,374 from 1,321 in April.
The number of pending new home sales in DFW in May was 1,663, compared to 1,566 in April.
The three-month moving average of new home sale prices last month was a record $486,172 vs. $470,756 in April — up over $72,000 since May 2021 for an increase of more than 17% year-over-year.
Higher prices notwithstanding, HomesUSA.com reported good news for home shoppers. The three-month moving average for May showed signs of available homes improving with new home MLS listings in North Texas increasing to 1,623 compared to 933 in April, said Ben Caballero, CEO of HomesUSA.com.
“Builders are clearly improving inventory as Dallas area new home sales continue to defy conventional wisdom with persistent strength,” Caballero said.
Average new home prices also set record highs in Houston ($416,787 in May vs $414,058 in April) and San Antonio ($381,444 vs. $370,165). However, the average new home price was lower for the third straight month in Austin ($541,842 versus $556,764).
“As builders’ costs keep increasing, demand is still exerting upward pressure on new home prices, setting records in three of Texas’s four largest new home markets last month, including Dallas-Fort Worth,” Caballero said.
Total new home sales in Texas were higher statewide and in all four of the major new home markets last month, according to the three-month moving average. In Houston, May total sales were 1,797 vs. 1,775 in April. In Austin, May sales totaled 581 vs. 497 in April. In San Antonio, new home sales increased to 548 last month from 495 in April.
The sales data in DFW — and for Texas as a whole — bucks the national trend, according to the most recent figures available.
The pace of new home sales fell by 16.6% in April nationwide from the month before to a seasonally adjusted annual rate of 591,000 homes. That’s the lowest level in two years as rising interest rates, home prices, construction costs and supply chain problems subdued the industry.
Updated national data will be available with the release by the Commerce Department of its nationwide New Residential Sales Report for May, set for Friday.
Turning to another metric, home building permits nationwide sank by more than economists projected in May, coming in at less than 1.7 million despite expectations they would remain roughly flat from April at about 1.8 million.
A slowdown in single-family building permits is occurring in many of North Texas’ previous residential construction hotspots as well.
Year-to-date through May, Frisco has fallen 42%, Celina is down 34%, Prosper is down 17%, Princeton is off 14% and McKinney is down 11%, compared to the same January-through-May period last year.
On the DFW sales front, Caballero added that builders are listing more new homes in the MLS, providing more reliable and timely residential sales data. Previously, new homes sold so fast that builders were selling from waiting lists and not listing as many homes in the MLS. Beginning in Mid-March, Caballero began seeing a steady increase in the number of MLS listings, he said.
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