The continued policy errors from the Trump administration are piling up on the housing market. Pending home sales for September crashed 18 percent year-over year in Denton County. Pending contracts were down 24 percent in Collin County. Tarrant and Dallas counties experienced declines of 14 percent 13 percent respectively.
Spiking mortgage rates and a K-shaped economy have made things very challenging for the North Texas housing market. $4 gasoline and $6 diesel are hitting drivers and the the shipping industry. Those elevated fuel costs eat their way into consumer prices. The massive investments in AI datacenters have also played a role in the stagnation for housing. There’s a finite amount of capital to go around in any given market. Massive investments in the AI sector leave limited capital for residential investment. Spending growth has plummeted for the residential sector, and even for other manufacturing.
It’s not all bad news, fortunately. Despite the stagnation area home prices are still holding up relatively well. Median home prices in Denton County were down 4.2 percent year-over-year in September. Average prices were unchanged. Under the surface, prices are likely lower than the official stats due to the big incentives from area home builders. With mortgage rates at 7.5 percent, builders are paying big money to buy down rates or get those monthly payments down to manageable levels.
Inflation Comes Roaring Back
High energy prices filtered into consumer prices again in September. The Consumer Price Index (CPI) showed an annual increase of 3.7 percent for September. Producer prices spiked even more. The Producer Price Index posted an annual increase of 6.3 percent. Core final demand rose at a 5.0 percent annual rate. That was the sharpest increase in final demand inflation in several years.
The sharp spike in final demand is important because it’s a leading indicator for consumer prices. It’s similar to how pending sales reflect future closings.
The interesting part of the higher-than-expected inflation readings this week is the response in the bond market. Treasuries completely blew off the high inflation readings, looking instead at fallout in the AI sector. The market was apparently pricing in softer growth with a slowdown in that sector. It will be interesting to see where yields go from here.
North Texas Market Still Favors Renters
For the time being, the market is still favoring renters over home buyers. New home builders and sellers cutting deals to get sales closed. The incentives for interest rate buydowns and other concessions are making for a competitive market if you are selling a home. The multifamily vacancy rate in Denton Texas is sitting at 12.7 percent. The vacancy rate in Denton County stands at 10 percent.
If you are looking to rent an apartment or a single-family home, you should find plenty of options. The median rent for a Denton apartment is down 5.7 percent from this time last year. Median rents for single-family homes in Denton were 5.9 percent lower than September of last year. Denton County rental homes saw a 2 percent decline in median rents.
It’s still a challenging housing market for prospective DFW home buyers despite plentiful inventory. 
Self-Inflicted Wounds
It’s shaping up to be an interesting November midterm election. The self-inflicted wounds from the Trump administration haven’t been kind to the housing market or the U.S. economy. Virtually every metric in the economy is worse off since Trump took office for a second term.
Fuel prices are higher, wage increases are lower, and inflation is eating away at consumers’ budgets as they struggle to keep up. Instead of draining the swamp and balancing the budget, Trump is blowing another $2 trillion deficit in 2026. The national debt was $35.5 trillion when Trump took office for a second term. It is now over $40 trillion, with no signs of slowing down.
For the record, I consider myself an independent. I normally don’t care what party a candidate has stamped on their bio. I do care about the policies they are implementing. Policies drive outcomes. The policies under Trump 2.0 have been a glorified trainwreck. The Big Beautiful Bill has been a disaster, entrenching huge tax cuts for the wealthiest Americans while raising taxes for those working to make a living. It’s very clear Trump’s corporate-friendly policies are designed to favor capital over labor.
Inflation has wiped out nearly all of the wage gains for Americans since January 2025. That’s how severely the Iran war has affected Americans’ finances. And this was entirely avoidable! Bad judgement, hubris and astounding levels of corruption are a poor recipe for a thriving U.S. economy and a healthy housing market.
If you are in the market to buy or sell a home, be safe out there. Expect more volatility as we head into the year’s end.
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