Photo by Maurice Williams on Unsplash
Houston’s real estate market just achieved its ninth consecutive month of positive sales, along with setting a pricing record for single-family homes. Sales of single-family homes increased by 1.2% over the past year, reaching 6,049 sales in February, the Houston Association of Realtors’ March report reveals. Additionally, total property sales rose by 1.9% to 7,464, while total dollar volume for the month increased 17% to $2.4 billion. All this progress has been possible despite scant inventory and a disruptive winter storm, which left many Houston-area residents without basic services like water and electricity, and caused property damage.
Luxury home sales boom
Sales in every housing segment valued at or over $250,000 increased by double digits in February. Luxury homes (priced at a minimum of $750,00) experienced a nearly 65% increase in sales. Homes valued between $500,000 and $749,999, meanwhile, had a 55% increase, while homes priced between $250,000 and $499,999 had a 16% increase. In comparison, housing segments priced at or below $249,999 didn’t fare so well. Homes valued between $150,000 and $249,999 decreased in sales by nearly 17%; homes between $100,000 and $149,999 had a 42% decrease; and homes worth $99,999 or less saw a 40% decrease. Another record was set for average and median sales prices of single-family homes: the average price jumped 16% to $349,963, while the median price increased 12% to $275,900.
Supply-demand imbalance
At the same time, market supply failed to match ongoing demand. In February, single-family home inventory dropped by 27.8%, reaching a record-low 1.6-month supply — that’s down from a 3.3 month supply in February 2020. In comparison, the overall housing inventory nationwide now sits at a historically low 1.9-months supply. Inventory estimates how many months it would take to sell current home listings based on sales pace over the past year. Indeed, Houston homes were snapped up fast throughout February; they spent an average of 48 days on the market — 20 days less than in February 2020. Total active listings in Houston also fell by nearly 39%.
The future of real estate
Real estate agents are having no problems selling homes in the current climate. Thanks to a strong market and the latest real estate selling techniques, agents are continuing to successfully close deals and keep clients satisfied. In Houston, it is hoped that more homes will be put on the market in the current months to boost current inventory and satisfy demand. “As we head into spring, we urgently need more listings to enter the market place or we risk having extremely limited inventory for consumers that want to buy a home now, especially with the prospect of rising mortgage interest rates,” said HAR Chairman Richard Miranda of Keller Williams Platinum.
Ultimately, agents are pleased with the market’s perseverance in the face of harsh conditions. “The Houston housing market showed resiliency again last month, coming through strong despite the brutal winter storm that caused widespread power outages, property damage and briefly held up transactions and showings,” Miranda commented.