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New housing construction is seen on South Mary Street in Arlington in April 2024. This year, builders started construction and closed on fewer homes during the quarter than the previous year, a new report says.<\/p>\n
Smiley N. Pool\/Staff Photographer<\/p>\n
Homebuilders\u00a0in Dallas-Fort Worth saw a slightly subdued market in the first few months of 2026, according to new data.<\/p>\n
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Dallas-based market research firm Residential Strategies Inc. released data for the first quarter of 2026, with the findings highlighting challenges like the Iran war that may cause complications in the market. However, firms have reasons for cautious optimism, the analysis notes.<\/p>\n
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Builders started construction and closed on fewer homes during the quarter than the previous year.<\/p>\n
The report detailed a market that\u00a0underperformed benchmarks from the previous year. with March followed a seasonal pattern of strong sales. However, the Iran war caused mortgage rates to rise, leaving questions about how the conflict could have a lasting impact on the region\u2019s housing market.\u00a0<\/p>\n
Pattern of sales<\/p>\n
Builders started construction and closed on fewer homes during the quarter than the previous year.<\/p>\n
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Construction started on over 11,100 homes during the first quarter, a 4.3% decrease from the prior year, according to initial numbers in the report. Over the last four quarters, builders started construction on about 40,670 homes.<\/p>\n
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<\/p>\n Add Preferred Source<\/p>\n <\/a><\/p>\n Meanwhile, D-FW homebuilders closed on nearly 9,780 homes, a 10.8% decrease from the year before, according to the report. Over the last four quarters builders closed on about 44,120 units.<\/p>\n Following a downward shift in activity last summer<\/a>, RSI principal Ted Wilson said he was personally concerned about the market. But things appear to have stabilized as builders had more positive sales reports and customers shopped during the quarter, he said.<\/p>\n Article continues below this ad<\/p>\n During that summer, builder starts were at about 9,100 homes, and closings were at 11,080 homes, according to the report.<\/p>\n In addition to new homes, there were 91,435 existing home sales in North Texas for the 12-month period that ended in February, according to the Texas A&M Real Estate Center. The number is similar to the previous year, according to the report.\u00a0<\/p>\n The report also showed that job growth, while increasing, is still behind historical trends.<\/p>\n Article continues below this ad<\/p>\n Texas\u2019 12-month job growth pace was at about 41,900 jobs as of January 2026, according to\u00a0the Texas\u00a0Workforce Commission. According to the RSI report that rate was an improvement from late 2025 but behind the historical average from 2010 to 2023 of about 95,000 jobs.\u00a0<\/p>\n Mortgages and Iran<\/p>\n Lower mortgage rates played a key role in demand for homes early in the year, but those rates haven\u2019t stayed steady, according to the report.<\/p>\n The 30-year fixed mortgage rate fell below 6% during a week in late February, averaging 5.98%, according to Freddie Mac. It marked the first time rates had been below 6% since 2022.<\/p>\n Article continues below this ad<\/p>\n However, mortgage rates moved higher in March<\/a> as the Iran war continued. Rates reached 6.46% in the first week of April and were at about 6.30% as of April 16, according to the report and Freddie Mac<\/a>.<\/p>\n Mortgage rates tend to follow\u00a0the 10-year treasury bond yield. Uncertainty and the prospect of higher inflation due to rising oil prices have caused the treasury bond yield to rise.\u00a0<\/p>\n Oil prices showed signs of changing after\u00a0Iranian officials declared that the Strait of Hormuz would be open<\/a> for the period due to the cease-fire.<\/p>\n Despite the rising mortgage rates, homebuilders reported people are still buying and March was a strong month, Ted Wilson said. March tends to be a strong month due to the seasonality of home buying.\u00a0<\/p>\n Article continues below this ad<\/p>\n Don Dykstra, co-founder of Bloomfield Homes, said the war is hard to plan for. However,\u00a0sales have been a bit better than expected and the underlying reasons people buy a home are still constant, he said.<\/p>\n \u201cThey get married, they have kids, kids leave the house, they get a promotion and have more money,\u201d Dykstra said. \u201cAnd those life events have continued to occur, which creates pent-up demand.\u201d<\/p>\n Counting lots<\/p>\n Another challenge for the D-FW housing market has been an elevated supply of vacant developed lots.<\/p>\n Article continues below this ad<\/p>\n The region had over 110,000 vacant developed lots at the end of the quarter, representing a 32.5 month supply \u2014 a state of oversupply relative to a 24 month supply equilibrium benchmark, according to the report.\u00a0<\/p>\n By signing up, you agree to our Terms Of Use<\/a> and acknowledge that your information will be used as described in our Privacy Policy<\/a>.<\/p>\n Since peaking in the third quarter of 2025 at about 72,300 lots under development, that number has fallen to about 67,000 lots in progress at the end of the first quarter of 2026, the report said.<\/p>\n The market is processing an overhang of supply from a different demand environment, said RSI senior vice president Ned Wilson in the report.<\/p>\n Article continues below this ad<\/p>\n \u201cBuilders are becoming much more selective on new lot takedowns as they focus on preserving capital and aligning future development with realistic absorption levels,\u201d Ned Wilson said.<\/p>\n","protected":false},"excerpt":{"rendered":"New housing construction is seen on South Mary Street in Arlington in April 2024. 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