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North Texas new home costs soar to record prices, topping $300,000 mark (4/27/16)

By Steve Brown/Real Estate Editor

If you want a new home in North Texas you’ll have to pay more than ever before.

Median new home prices in the Dallas-Fort Worth area now top $300,000 – almost 50 percent more than what you’d pay for a mid-priced preowned home in the area.

“We are at an all-time high for new home prices,” said Paige Shipp, regional director for housing analyst Metrostudy. “Prices continue their upward shift, as builders report the greatest demand, and strongest sales for the first quarter are between $250,000 and $400,000.”

Almost a third of the new houses started so far in 2016 will be priced at more than $400,000, according to the latest Metrostudy report.

Rising construction and labor costs are making it almost impossible for builders to construct low-cost houses in North Texas.

“Due to rapidly rising land and development costs, developers argue there is little hope for the revival of the sub-$200,000 new home market,” Shipp said. “An entry level home on a typical 50-foot-by-110-foot lot is no longer feasible.

“The land, development and constructions cost are too high,” she said. “Not to mention the exorbitant fees municipalities charge.”

Median new home prices have increased by almost 60 percent in North Texas in the last decade, Metrostudy figures show.

In the first quarter, starts of houses that will sell for $500,000 to $749,000 rose more than 50 percent, the research firm found. And starts of homes priced at $750,000 and more were up by more than 30 percent.

Builders say that shortages of construction materials including cement and a lack of labor in the market are putting even more pressure on prices this year.

Even so, total home starts rose 22 percent in the first quarter from 2015 levels, Metrostudy reports.

http://bizbeatblog.dallasnews.com/2016/04/north-texas-new-home-costs-soar-to-record-prices.html/