1 | JOB GROWTH
It’s no secret the multifamily market in Dallas-Fort Worth is one of the most stable and dynamic in the country. Home to the largest multifamily pipeline in the nation, adding residents at more than three times the national average. According to Yardi Matrix, more than 45,000 apartment units have been added since the beginning of 2018. This is a direct result of the robust job growth in North Texas. Dallas-Fort Worth added 120,700 non-farm jobs in 2019. Dallas accounted for 72% of the total workforce, with 97,800 jobs added, an increase of 3.7% over the previous 12 months. Fort Worth accounted for the remaining 28%, with 22,900 jobs added, which was an increase of 2.1%.
DFW led the nation in job growth for the 3rd year in a row, at 3.2%.
2 | RENT GROWTH
The influx of residents has led to very strong rent growth across Dallas-Fort Worth. Rent growth has been on a steady rise, and since 2014 is 29%, according to Yardi Matrix. In 2019, rents were up 2.8% across all asset classes. The Renters-by-Necessity class led rent growth with an average of $999, an increase of 4.1% from 2018. The Lifestyle segment grew 2.0% to $1,428.
Fort Worth experienced the most rent growth, holding 10 out of the top 15 DFW submarkets. These include Tanglewood/Westcliff, up 8.5% to $1,069 and Downtown Arlington, up 8.4% to $932. Richardson led the way for Dallas, with an increase of 7.6% to $1,074, followed by Fair Park, up 7.5% to $820. We are seeing more and more activity in predominately working-class submarkets like Fair Park, primarily due to value-add investors who are looking to take advantage of the rent growth.
North Arlington rent growth totaled 44.9% from 2010 to mid-2018. That compares to rent growth of 35.3% for Dallas / Fort Worth and 31.6% nationally over the same period.
3 | SUPPLY
In 2019, Dallas-Fort Worth led the nation with 47,129 multifamily units under construction. DFW has added more than 95,000 units since the beginning of 2015. National Apartment Association and the National Multifamily Housing Council commissioned a study where findings showed DFW has enough multifamily demand to justify the creation of 19,000 apartments every year in order to keep pace with the anticipated future demand. The new supply in the metroplex over the past 10 years has enabled massive growth in the suburbs, and they are thriving more than ever. Far North Dallas continues to dominate the new construction niche. North Frisco/West McKinney has the most units under construction, with 4,201. Cityscape/Downtown is a close second, with 3,928. The added supply of new units has enabled value-add investors an abundance of B and C class assets that are ripe for repositioning.
“DFW built 136,166 apartment units as well as absorbed 141,533 apartment units which is roughly 6% of the entire U.S. apartment construction pipeline, between 2010 and 2019”, CoStar said.
4 | A GROWING MARKET ON THE RISE
The Metroplex is home to some of the strongest real estate fundamentals in the world. More than $4.2 Billion in assets traded in 2019. Average price-per unit has reached $114,847, which is a far cry from the 2008 average of $52,297. Multifamily in Dallas-Fort Worth is not only flourishing but is on a trajectory to be strong for years to come.
If you would like to know more about the strengths of the Dallas-Fort Worth market, or what this can potentially mean for you as an owner, please feel free to reach out. You can contact me at 972-532-6126 or firstname.lastname@example.org
About the author:
Nicholas Brown is an Associate Director with Greystone | Investment Sales Group in Dallas, TX. If you want to learn more about our Off-Market Opportunities, Multi-Family Listings, Land Sale Listings, Property Valuations, Debt Platform, or meet for coffee to exchange value-add ideas, contact our office:
Greystone Investment Sales Group
6320 LBJ Freeway, Suite 228, Dallas, TX, 75240