Most Buy in Dallas County, but 22 Percent Buy Elsewhere
In the last blog on state household mobility, we found that there was more migration from high-cost states, such as California and New York, to more affordable states, such as Florida and Texas, than the other way around. As an example, for every 10 Texas residents applying for a home mortgage outside of Texas, there were 13 out-of-state residents applying for a mortgage in Texas. While migration to and from other states will affect home sales, about 92 percent of mortgage applications in Texas are made by current Texas residents. In other words, there is more intrastate than interstate movement in Texas. However, not all parts of Texas are affected evenly by this migration. As a case in point, this blog focuses on homebuyer mobility in the Dallas metro area.
Consistent with the state’s net gain during 2016 through June 2017, the Dallas Core Based Statistical Area (CBSA), which is comprised of thirteen Texan counties, experienced a net gain in mortgage applications from out of state: For every 10 mortgage applications from Dallas going out of state, the CBSA received about 14 out-of-state mortgage applications. Even though home prices for Dallas appear high relative to income, prices may still be less than for a similar home in higher-priced metros. However, not all counties in Dallas had a net influx of home-purchase applicants. Dallas County experienced the highest net loss and Denton County the highest net gain.
Among Dallas County residents who applied for mortgage loans during 2016 through June 2017, about 38 out of 100 households were looking to buy outside of the county. Figure 1 summarizes the net flow of Dallas County applicants during this time period. Dallas County, on net, lost 22 percent of its residents who wanted to buy a home. About two-thirds of the net outflow, representing about 14 percent of current Dallas residents who wanted to buy a home, were looking to buy in neighboring northern and western counties, including Collin, Tarrant and Denton. By contrast, only one-fourth of the net outflow represents households buying in neighboring southern and eastern counties, including Kaufman, Ellis and Rockwall. Economic growth in the north of Dallas has caused more people to move north of Dallas than to the south.
In contrast to Dallas, Denton County gained applicants from Dallas, Tarrant and Collin counties as well as from out of state (Figure 2). During 2016 through June 2017, for every 10 Denton County residents looking to move elsewhere, there were 13 non-Denton County applicants moving to Denton County. Denton County had an 11 percent increase in mortgage applications because of the net inflow from other areas. More than two-thirds of the net inflow was from Dallas County. However, Denton County lost some of its residents to its neighboring counties such as Wise, Grayson and Rockwell.
Consistent with CoreLogic findings in earlier blogs, potential homebuyers were attracted to more affordable counties with economic opportunities. The average price-per-square-foot for homes sold in Dallas County during 2016 through June 2017 was higher than Denton, Tarrant and other neighboring counties, but still cheaper compared to some of the nation’s high-cost cities. The price-per-square-foot in Dallas County was $143 compared to just $124 for Denton County (Figure 3). When the price is affordable, people look for additional amenities, such as newer and bigger homes, and open areas. About 20 percent of the homes sold during 2016 through June 2017 in Dallas County were built after 2000 and were also smaller than the neighboring counties. By contrast, 54 percent of the homes sold during the same time period in Denton County were built after 2000 and were bigger than the homes in most of the Dallas metro counties.
 The analysis in this blog is based on home-purchase mortgage loan application data. All applications, whether approved or not, were included in the analysis. Mortgage applications submitted by investors and second-home buyers were excluded in the analysis.
 The CoreLogic Market Condition Indicator (MCI) has identified Dallas as overvalued for most of the last two years.
 The Figure 1 net flow percentage is calculated relative to the total number of Dallas County residents that submitted a mortgage application. A positive (or negative) value indicates net inflow (or outflow) of homebuyers to Dallas County. For example, “-5” means that the net loss of homebuyers to another county (measured as the number of buyers from outside of Dallas County buying in Dallas less the number of Dallas households buying in Dallas county) equaled 5 percent of the number of Dallas County residents that applied for a home-purchase loan.
 Average price-per-square-feet is $964 in San Francisco and $428 in Los Angeles.
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