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New Apartments in Dallas 2012 – 2017
Dallas is growing, and it’s not stopping anytime soon. Dallas has experienced tremendous growth over the past five years leading to a significant increase in apartment development projects. Over 100 apartment buildings opened within eight miles of Downtown Dallas between 2012 and 2017, increasing the city’s landscape by more than 30,000 apartment units.
During this same time-frame, the city has experienced a year-over-year growth rate of 3.5 percent. It’s no wonder that Dallas was named one of the best cities in the United States for residential real estate investments. There are several factors driving the city’s evolving apartment market. Here are some key points to consider:
More Jobs, More Apartments
Part of the apartment construction boom can be attributed to the increased economic opportunities from companies relocating to the area. Dallas is already home to billion dollar-generating private and public corporations, such as AT&T, Energy Transfer Equity, Texas Instruments, Southwest Airlines and Neiman Marcus. The metro area also sees more than 100,000 jobs on an annual basis. Local non-farm employment also increased by 2.8 percent between August 2016 and August 2017.
Dallas added 717,000 alone between 2010 and 2016. The city has also seen companies, such as MV Transportation, Inc. and Ameriflight LLC., relocate their operations and headquarters to Dallas since 2012. Large companies and firms have also relocated to the area, bringing thousands of jobs and prompting a need for additional housing. Toyota’s North American headquarters relocated on the outskirts of Dallas in Plano, Texas from Torrance, California in July 2017. The company is expected to bring over 1,000 jobs to the area. This economic growth works to attract new city dwellers.
Who’s Moving to Dallas
The surge of Dallas residents can be attributed to a growth of population, and much of the growth is due to people relocating to the area. The population growth has increased heavily in Dallas from 1.242 million in 2012 to 1.318 million in 2016. Since 2010, approximately 800,000 people have relocated to Dallas. Moreover, the population increased by 143,000 people between 2015 and 2016 alone, making it one of the fastest growing cities in the country by population growth in 2016. Additionally, the central renter millennial demographic of ages 20 to 34 is expected to continue to increase by 9 percent through 2022.
Apartment Construction on the Rise
Apartments in Dallas are becoming increasingly attractive, as Dallas has become city where it’s more affordable to rent an apartment than to buy a home. Thanks to a growing population, increasing property values and growing job opportunities, apartment construction in Dallas has been on the rise and is continuing to evolve. When you expand outside of the city of Dallas to the greater DFW area, the growth numbers are even more impressive.
Since 2012, 54,800 apartment units completed construction. About 58 percent of the apartment units constructed in 2016 were one-bedroom apartments, while 33 percent were two-bedroom apartments. A RealPage MPF Research study revealed that more than 50,000 apartment units were under construction in the Dallas-Fort Worth area in the first quarter of 2017, with some of the top apartment construction markets in the nation focused in DFW. Approximately 9,488 apartment units in the East Dallas, Northeast Dallas and central Dallas markets were under construction during that period as well.
Central Dallas is the second highest apartment construction market in the Dallas-Fort Worth area, accounting for 5,578 apartment units under construction. This widespread construction growth has led to a rent growth exceeding 5 percent in the metro area. This is due in part to area’s rising property values. With more jobs and economic opportunities comes more residential development.
Dallas Destined to Grow
With an increased growth in population and jobs, the growth of the Dallas apartment rental market is transforming from a trend to an evolution. Dallas has plenty of room for more growth, but absolutely needs to maintain a steady inflow of new residents. Population growth means more apartment development and more supply to meet the growing demand for apartment housing. We have heard words of caution and skeptics of the construction boom warning of over-building. While this is absolutely a concern and likely to occur at some point, we have yet to see any signs of occupancy dips or a serious reduction in rents which are both signs of an over-built market.
For years now, Uptown has been the premier residential area in Dallas based on location alone, but Downtown has made a huge resurgence and the recent construction trends are focused in and around both Uptown & Downtown. Farmers Market is an example of a neighborhood that completely redeveloped within a couple of short years, primarily due to new apartments & retail development. While it’s not pictured on the map above, there is an equally as impressive boom currently happening in Richardson, Addison, Plano, Frisco & surrounding areas. We plan to release a follow-up graphic of these areas soon.