- Rex Real Estate’s Rex Glendenning expects North Texas land sales to cool for about 18 months because sellers’ asking prices exceed what buyers will pay.
- Northeast Texas rural land prices fell nearly 6% year over year, while West Texas gained more than 14% and statewide prices rose more than 3%.
- Hillwood expects about 35,000 residential starts next year, below its 2022 peak of 60,000, and developers see seller financing and mixed-use projects as ways through the slowdown.
North Texas’ land market is cooling after a five-year run, according to Bisnow’s coverage of its Texas Residential Summit.
Rex Real Estate owner Rex Glendenning said at the event that sellers’ prices and buyers’ bids sit too far apart, and that the market needs roughly 18 months to rebalance.
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Prices Split by Region
Northeast Texas farmland and rural parcels fell almost 6% year over year, according to The Agency Dallas’ fall land price report, cited by Bisnow.
By contrast, West Texas prices jumped more than 14%. Statewide prices also gained over 3%, according to the same report.
Too Many Lots
Glendenning told the Bisnow audience that developers have overbuilt lot supply before and repeated the mistake.
Hillwood Communities President Fred Balda said his firm’s starts peaked at 60,000 in 2022. Hillwood is tracking toward about 38,000 this year. Balda expects around 35,000 next year, which he compared to 2019 activity.
Reading the Dip as an Opening
Centurion American President Mehrdad Moayedi told the summit he sees the downturn as an opportunity to pursue projects that once cost too much. The firm has major projects in Gunter, Anna, Denison and Fort Worth.
Craig International CEO David Craig said flexibility matters. His firm has leaned on mixed-use and master-planned projects, including the $6B Preston Harbor development in Denison.
Seller Financing as a Bridge
Glendenning said landowners can help close deals by carrying a two- to three-year note at 5% or less. This option could help as banks tighten lending and rates remain high.
Zoom Out
Capital is also chasing the same space from the lending side. We covered how homebuilder land loans are drawing fresh money, with Starwood and Trez planning a $450M seed round.
Why It Matters
A bid-ask gap usually means fewer trades until prices adjust. As a result, developers with cash or financing flexibility can acquire land that others cannot finance.
Pricing pressure also affects housing. We covered how higher rates may force apartment sellers to cut prices, according to Marcus & Millichap.
What’s Next
Glendenning’s 18-month window points to slower land trading in 2027. However, strong population growth and corporate relocations should help sustain demand, Bisnow reported.
