Dallas-Fort Worth’s housing market will sizzle in 2021, but it won’t be as hot as Austin’s.
Austin claimed the top spot for the second year in a row, while Dallas ranked sixth, according to a panel of real estate experts and economists surveyed by Zillow.
DFW had a net score of 39 based on the 54 percent of those surveyed who said it would outperform the national average, and less the 16 percent who said it would underperform.
Austin had a net score of 76, with 84 percent expecting it to outperform the national average and 9 percent expecting the capital metro to underperform.
Houston ranked 12th of the 20 markets surveyed, with a net score of negative 2.9 percent. Some 32 percent of the experts said Houston will outperform, while 35 percent said it will underperform.
In some cases, the net scores don’t quite add up due to rounding.
Overall, the market is expected to be strong across the board. In order, the experts put Austin, Phoenix, Nashville, Tampa, and Denver ahead of DFW to grow by the largest margins nationwide.
Expensive coastal metros such as New York, San Francisco, and Los Angeles are expected to underperform — a shift from growth patterns in recent years.
The biggest tailwinds for the market include an improved economic outlook bolstered by progress on coronavirus vaccines and strong demand generated by first-time, millennial homebuyers. On the flip side, affordability and available supply will hold the market back.
Like Dallas-Fort Worth, the markets forecast to outperform the nation are, for the most part, sunny locales, Zillow senior economist Jeff Tucker said.
“The pandemic has not upended the housing market so much as accelerated trends we saw coming into 2020,” Tucker said. “These Sun Belt destinations are migration magnets thanks to relatively affordable, family-sized homes, booming economies, and sunny weather. Record-low mortgage rates and the increased demand for living space, coupled with a surge of Millennials buying their first homes, will keep the pressure on home prices there for the foreseeable future.”
Austin was predicted to be the hottest market in last year’s survey, and that proved true, according to Zillow. By mid-December the median list price for homes in the Austin metro area was up 23.6 percent year over year, making it the largest rise among the 50 largest U.S. markets.