Nearly 1 million apartments are under construction across the U.S., and Dallas ranks No. 7 among the 50 largest metro areas in new-construction housing permits, according to a report released Tuesday.
Dallas is No. 3 in Texas, according to the report, behind Austin and Houston.
Almost 34,000 new apartments were added to the housing stock in Dallas last year, according to an ApartmentList report. About 43,574 Dallas single-family homes were permitted in 2022.
“A record number of new apartment units [are] under construction, and this influx of new supply should keep prices in check,” states the report from Chris Salviati and Rob Warnock. “While encouraging, this recent construction boom does not change the fact that the nation is currently in the midst of a broad housing affordability crisis that has built up over many years. And even as multifamily construction remains hot, the construction of new single-family homes has recently begun to sputter.”
Domain at Midtown Park
In an effort to address the aforementioned affordability crisis, the Dallas Housing Finance Corp. approved Tuesday a memorandum of understanding with Newport Beach-based Waterford Property Co. for the acquisition of Domain at Midtown Park, a multifamily residential development at 8169 Midtown Blvd. They also registered an LLC with the Texas Secretary of State to own the development with the corporation as the sole member.
The HFC provides tax-exempt mortgage revenue bonds for the acquisition, construction, or rehabilitation of multifamily housing.
In the case of Domain at Midtown Park, the apartments already exist but will be rehabilitated into affordable workforce housing. The 395-unit complex was built in 2017 north of Walnut Avenue. Developers with Waterford Property Co. said Tuesday they are proposing to income-restrict half the units for tenants at or below 80 percent of the Area Median Income.
“From a workforce housing standpoint, we think this property meets the goals of the HFC and the program you’re rolling out from a policy standpoint,” a spokesman said.
Residents living in the income-restricted units will save about $223 per month on rent. The City of Dallas would forego about $33 million in property taxes but gain about $277 million over the 40-year life of the deal, officials said.
“From an investment standpoint and an affordability standpoint, we think this project makes a lot of sense,” the spokesman said. “The goal of this program is to fit the housing needs for low-income families.”
HFC projects approved by the board must go before the Dallas City Council for approval. On Tuesday, board members of the housing finance corporation postponed decisions on Rosemont at Meadow Lane, a multifamily residential development at 4722 Meadow St., and The Positano, a multifamily residential development at 2519 John West Road.
Apartment Boom
The skyrocketing number of permits reflects the interest of Dallas leaders in providing more housing and diverse options to accommodate growth.
Realtors said during a recent Dallas Builders Association event that there’s “a serious inventory issue” in Dallas.
“The total number of housing units permitted for construction across the U.S. fell slightly last year, from 1.74 million in 2021 to 1.65 million in 2022, marking the first year that this figure has declined since 2009,” the ApartmentList report states. “The total number of building permits issued in 2022 was still higher than in any year from 2007 to 2020, but it continues to lag the peaks seen in the runup of the 2000s housing bubble.”
The report goes on to point out that much of the early 2000s boom was driven by suburban single-family construction.
“While that type of development still makes up a majority of new construction, there has been a notable shift toward denser multifamily construction in the core cities of many metros over the past decade,” the report states. “Across the nation’s 50 largest metros as a whole, there is a clear trend, on average, of core cities accounting for a greater share of new permitting since the Great Recession.”
