One million jobs in 10 years and hundreds of thousands of new people will do wonders for a housing market.
Add on extremely low mortgage rates and you've created a housing market in North Texas that is “on fire,” according to Fred Balda, president of Hillwood Communities.
Home sales for the Dallas-based residential development firm were up 30 percent in January over the previous year, Balda said.
Sales were especially strong in Hillwood’s Bluewood master-planned community in Celina, its Union Park community in Little Elm, its Harvest project in Northlake, and its newest project, also in Northlake, called Pecan Square, Balda said.
"Four of my projects are killing it,” Balda said. “The sales are unbelievable. Those four projects all sold over 30 homes that month. That’s one home a day in each of these projects.”
In the interview that follows, Balda provides a big-picture overview of the DFW housing market.
How is the North Texas market overall?
It’s just outstanding and astonishing and unbelievable – all the nice adjectives you can think of. We do business across the U.S.A., and we do business across the great Republic of Texas. We have other projects in Austin and Houston, and we’re looking at San Antonio, again, but DFW really is our backyard, and it’s just been on fire.
Of course, we went through the recession back in 2009, so we’re really on our 10th year of economic growth. Interestingly, this past year, we added about 120,000 new jobs. When you look at the past 10 years, we’ve exceeded 1 million new jobs in this marketplace, which is outstanding. We’ve never done that before, so huge job growth.
The population, we’re sitting at about 7.7 million people, plus or minus a few, in the DFW metro, which makes us No. 4 in the entire nation. We’re adding about 165,000 net population growth, which is phenomenal. That’s been great, and it’s been fueling a tremendous amount of demand in our business.
When you look at Hillwood as a company, we’re focused on a variety of real estate products. Huge industrial activity. Huge multifamily activity. And of course, our residential communities business is also doing quite well.
When you look at the metrics for DFW, this market is leading the nation with about 35,000 new home starts in our single-family business. That’s No. 1 in the nation. That’s a 2019 number. In 2020, (housing analyst Residential Strategies Inc.) just upped their number to 36,000.
What makes the single-family housing market different today than the last peak in the market?
Our inventory in our single-family space is very tight. It’s not out of whack. The good news is this market is not going to fall off the cliff when it does start to drop. The bad news – if you want to say that – is that inflation is going to have to continue to keep going up because there’s just not enough homes.
The truth is we’re all focused on a more affordable, but nice, product, which means we’re now focused on a more dense product. When you look across the board, you’re seeing a greater percentage of smaller homes getting built on smaller lots to be really able to address what people can afford here.
To read the rest of this interview, click here.