Why are so many Millennial Buyers moving to Far North Dallas and beyond?
Texas has been the place to be for a very long time, particularly North Texas. I have sold New Homes in this area for over a decade, and during this time have heard just about every reason under the hot Texas sun for why people are relocating to the area. Spoiler Alert, it’s not for our beautiful scenery and trees! While I love the look and feel of the DFW area, and have lived most of my life here, it can be a culture shock for someone coming from mountains or water views.
When I asked customers “What is bringing you to our area?” Overwhelmingly the answer was for cheap Real Estate and opportunity! During the recession, I saw people literally pack up and move here with no job lined up at all, but knowing that if they were going to find one, this would be the place to do it. Families moved from California because it was too expensive, they moved from rural areas for their children’s education and many moved from the North to escape the cold, and they moved from the Gulf area to be safe from hurricanes. Over time, major corporations realized that the vast majority of the qualified workforce had moved here, and couple that with tax incentives being offered to them, it was a no brainer to relocate corporate operations to DFW.
I would always laugh when I would meet a family who was in town for a weekend and planned to visit new communities in Grapevine, Ft Worth, Mansfield, Dallas, Arlington, Lewisville, and Aubrey. No one seemed to understand the huge territory that North Texas encompasses. I would break it down on my sales map of the area, explaining that the original growth of the metroplex centered around the DFW Airport and directly East to West between Dallas & Ft. Worth. By settling close to DFW, people could easily commute for jobs that required travel but were also within 30 minutes of both major cities. As such, the middle suburbs were the ones to build out, and increase in price first. If you’re lucky enough to find a rare plot of land in Colleyville, Coppell, or Southlake to get your children into their highly sought after schools, you had better be prepared to pay a hefty price tag for it.
The families who came here during the recession have settled in, put down roots, and now their children are adults and out on their own. These Millenial buyers make up a unique, and rapidly growing portion of the Home Shopping Population. Many cannot afford a $750,000 home in the heart of the Metroplex and have found themselves renting apartments for much longer than the generations before them. Rental prices have skyrocketed to the point that many of these people are paying higher rents on a 1 bedroom apartment than my mortgage is on the home I purchased 10 years ago, including escrow. They don’t seem to mind, however. Most of them come out of college making twice the salary many of us did for our first jobs and can afford to maintain a high rent payment, plus the lifestyle they love (low maintenance, travel, evenings out). Many Millennials fail to buy homes because they don’t want to give up a little to no maintenance lifestyle just to shell out more money each month for a home.
Builders recognized this trend a few years ago, and as the market began to uptick again, went in search of more affordable land to bring home prices down, making homeownership both appealing and affordable to the millennial population. They mostly followed the growth of corporations along the Dallas North Tollway, pushing them into areas like Little Elm, Prosper, McKinney, & Anna, while some have started heading out West of Keller into North Ft. Worth. For our Millenial buyer, Collin County and beyond is where it’s at! Why is that?
If you drive down Hwy 380, East on 121, or North of 35E, you can’t help but notice there isn’t a lot out there other than road construction. Retail is slowing starting to emerge, and buyers along 380 and the Tollway were beyond thrilled for their Kroger to open up, but otherwise, it’s hard to get a good vision of what the area will become in 5 or 10 years. It’s difficult unless you walk into a builder’s sales office, which is exactly what the Millenial Buyer is doing! Builders have done an incredible job of recognizing that this buyer will do 95% of their home research on their own, and online before ever contacting a Realtor or walking into a Builder’s model home. These buyers can research a community from their smartphone and pull up everything from the builder’s available lots, and community pages with amenities, to customer reviews during their lunch break and walk into a model to check it out that evening. Creating the vision for a buyer now starts online with artist renderings of hiking trails, ponds, gardening areas, dog parks, and more. This buyer is looking to make sure they are not giving up too much of their fun life over by the Shops at Legacy if they decide to purchase a home 30 minutes away from there.
When my career in new home sales first began, master planned communities were few and far between. Many buyers would push back at the thought of an HOA telling them what to do. Once communities pushed past the cities infrastructure, developers were forced to include a couple of parks & green spaces and sometimes a pool. These are the communities that the Millennial buyer grew up in. They now fully expect parks & pools and then some! They want nightlife, active lifestyle, and an outdoor lifestyle with lawns for movies & food trucks, dog parks (because their dogs are their first children); they want a true sense of community gathering. During the past five years, communities with fewer amenities simply could not compete in the Mellinneal market.
This brings us back to Far North Dallas & Collin County. Developers out in that area just get it! The prices are slightly more expensive in that area than on the Ft Worth side of the metroplex, but what they get in their communities for a lower tax amount is substantial (assuming one can afford the extra MUD or PID tax)! Developers & builders know the price point of $250,000-$400,000 is going to attract mostly the Millennial buyer and some move-ups who are searching for a very specific lifestyle. School ratings are important but not as important as it is to those buying in Coppell or Southlake. If the Millennial buyer has children, they’re still young enough to not be impacted by a High School rating, so the school systems have time to grow, develop and bring the ratings up. They are close enough to the Tollway to commute into Plano or Dallas, and also incredibly close to Lake Lewisville for hiking, and outdoor events. What can’t be found within a few minutes drive is being built into their communities with gathering spaces! Many communities are even starting to include full-service restaurants on site that are not attached to a golf club.
The low maintenance life the Millenials are after can be mostly achieved in a new home due to the builder’s warranty. They know they can buy new and not worry about purchasing a water heater or HVAC system in a couple of years, which allows them to allocate that money towards other things they would rather spend it on, like travel. Buying an older home means knowing how to fix things or paying for a handyman. Most of these buyers do not know how to perform simple maintenance tasks like recaulking, replacing weather stripping, fixing a running toilet, or even replacing the garbage disposal. These skills are no longer being taught by parents or schools. If I had a dollar for every time one of my younger buyers called me to ask how to turn their water heater back on after it had gone out, or what to do about fire ants in their yard, I could have retired a long time ago!
The majority of the professional workforce in the Millenial group is working up and down the Tollway. Major corporations are attracted to these professionals because they are coming out of school with an entire technical knowledge base that older professionals don’t possess. While there is still a booming economic environment on the West Side of the Metroplex, there are not nearly as many major hiring companies in Ft Worth as there are in Dallas/Plano/Frisco. As such, Ft Worth has begun to attract an entirely different group of people. Those buying in Ft Worth are looking for a little more laid back of a lifestyle, would generally prefer a block party with a few close neighbors over a huge community event, and who are working either at the Joint Reserve Base or in more blue collar jobs.
This will all more than likely shift again as, eventually, people will only be willing to drive so far North in search of a lifestyle. Not many people will be willing to commute from the Oklahoma border into Plano! The natural shift then becomes for the Dallas worker to move into the Ft Worth side of town and commute a little further. It seems the Westside runs about 5 years behind the East in terms of developmental trends, so don’t be surprised when some of these huge master planned communities with the all-inclusive type amenities start popping up to attract the younger buyers along 35W! Although, it will probably start to happen just in time for the next generation to hit adulthood with completely new priorities! I can’t wait to see what those will be.