New home construction slowed during the first quarter of 2019 as North Texas home builders started just 8,439 new homes. According to data from Residential Strategies Inc, that represents a 4.4 percent decline compared to a year ago, and also the second quarter in a row in which homes starts in the DFW area have dropped.
Despite low mortgage rates and strong demand and buyer traffic, sales definitely tailed off towards the end of last year, which could be a product of economic uncertainty, the government shutdown, and the 2018 stock market ups and downs late last year.
As noted by the research and consulting firm, builders are now more focused on unloading existing inventory rather than starting new homes, and in some cases have offered some pretty significant discounts and buyer incentives in order to move their inventory.
The good news is that new homes sales throughout the entire DFW region jumped up by about 2.3 percent in the first quarter of 2019....but is this due to high demand and a strong seller market or more representative of a desperate new home builder market that has been giving away their new home inventory. The sweet spot seems to be for homes in the $250,000 to $350,000 price range, especially as more young and first time home buyers enter the marketplace. Home buyers searching new construction homes for sale in Dallas-Ft. Worth, TX should expect new home builder inventory to follow similar slowed growth patterns throughout 2nd and 3rd quarter as new home builders find ways to reduce new construction home inventory to a more stable and manageable level. New home builders nationwide still worry that high new construction housing inventory levels and high new home entry price point levels combined with rising interest rates could continue to drive affordability concerns leading to lower and lower demand and eventually forcing builders to once again start slashing prices, offering deep discounts, lower entry price points and other home buyer incentives like free in ground pools and free vacations to lure buyers in and move their stagnant inventory.