Will 2021 Be a Good Year to Buy a Home in the Dallas Area?
With the end of the year fast approaching, a lot of home buyers in the Dallas metro area are looking ahead to 2021. And many of them share the same overriding question. Will 2021 be a good year to buy a home in the Dallas-Fort Worth area?
From a market standpoint, now could be a great time to make a purchase. Those who postpone their home-buying plans until later in 2021 could encounter higher housing costs. So an argument could be made for buying sooner rather than later.
Understanding current housing market trends can help you answer this question. So let’s take a look at where the market is now, and where it might be going in 2021.
Dallas-Fort Worth Home Prices Rose Steadily During 2020
The Dallas-Fort Worth real estate market showed surprising strength throughout 2020. In the early days of the coronavirus pandemic, some feared that the real estate market might experience a downturn. Instead, home-buying activity continued at a steady pace.
According to a recent report from the MetroTex Association of Realtors, the median home price across the Dallas-Fort Worth area rose by nearly 13% from November 2019 to November 2020. That’s remarkable, when you consider the fact that we were dealing with a pandemic and economic slowdown during much of that period.
This relates back to the question at hand: Will 2021 be a good time to buy a home in Dallas? From an investment standpoint, the answer for many folks is yes. Home values in the area have shown resilience over the past year, due to strong demand from buyers. So it’s logical to assume that prices will continue to hold up going forward.
In a December 2020 press release, the research team at Realtor.com predicted that the median home price for the Dallas-Fort Worth-Arlington metropolitan area would rise by around 4.4% during 2021. Analysts from Zillow made a similar prediction, suggesting prices in the DFW area could rise by more than 5% over the next year or so.
So a sense of urgency might be warranted, among home buyers. Those who make a purchase earlier in 2021 could shield themselves from higher costs down the road. According to the Realtor.com report mentioned earlier:
“Buyers will need to act with a sense of urgency if they want to lock in a low rate before home prices increase even more in 2021.”
Speaking of low rates, that’s another reason why 2021 could be a good year to buy a home in the Dallas area.
Mortgage Rates Hovering at Record Lows, for Now
During the latter half of 2020, mortgage rates dropped from one record low to another. According to the weekly survey conducted by Freddie Mac, the average rate for a 30-year fixed mortgage was 2.71% for the week of December 10, 2020. That was the lowest average in more than 50 years. From an interest-rate standpoint, right now is a great time to buy a home in the Dallas-Fort Worth area.
Unfortunately, we can’t say with certainty how long this low-rate environment will last. Home buyers today can benefit by locking in some of the lowest rates we’ve ever seen. But that could change over the coming months.
In their mid-November forecast, the Mortgage Bankers Association predicted that 30-year mortgage rates could average 3% during the first half of 2021. Beyond that, they expect rates to creep up slightly. If this forecast proves to be accurate, it means that Dallas-area home buyers could encounter higher home prices and higher rates during the latter part of 2021.
Summary: A Good Time to Buy in 2021
We’ve covered a lot of information in this report, because we believe in keeping home buyers well informed about current market conditions. Here are five important takeaways:
- Home prices across the DFW metro area rose steadily during 2020.
- Forecasters are predicting a continuation of this trend going into 2021.
- Home buyers who purchase over the coming months could face higher prices.
- Mortgage rates are currently hovering at historically low levels.
- For many reasons, 2021 could be a good year to buy a home in the Dallas area.
Have mortgage questions? Trinity Oaks Mortgage proudly serves the entire DFW Metroplex. Our experienced loan officers can answer any mortgage-related questions you have and guide you through the process. We look forward to hearing from you!