Slowing job growth cooling DFW’s hot real estate market?

​​​RICHARDSON – North Texas’ booming real estate market is likely to slow down in 2016 due to slower job growth, said the Real Estate Center’s chief economist.

Dr. Jim Gaines made his 2016 predictions at the annual forecast session of the MetroTex Association of Realtors last week.

He said 2015 is on track to be a record year for their businesses, as North Texas home sales are up about 6 percent from this time last year, and median home prices through the first nine months are 11 percent higher. The Dallas-Fort Worth area is one of the top five U.S. home building markets. 

However, Gaines said he expects prolonged lower oil prices and job cuts in the energy industry will result in slower growth in Texas. 

"We are still going to grow next year," he said, "but at a slower rate."

Although the potential for higher interest rates in 2016 isn’t a significant concern, Gaines pointed out that home affordability may be a bigger issue in DFW, given that home price increases have been outpacing wage gains.

Additionally, home construction in DFW is still less than 60 percent of the volume before the recession. Constraints on home construction caused by labor shortages and higher land costs are a problem across the nation.