Houston Residential Housing Is Returning To Normal

The Demand for Houston Homes is Gaining Momentum Despite Higher Mortgage Rates and the Pandemic Hangover

Home sellers and home buyers are back declares Houston Home Buyers, as of April 2024. The COVID pandemic knocked the residential real estate market on its ear but things are close to where they were pre-pandemic. A healthy and functioning housing market is good news for everybody. Home sellers have returned despite facing higher mortgage rates when they re-enter the market as buyers. And home buyers have begun to accept the new reality of higher financing costs.

We buy houses such as this one in any condition with 100% cash.

How is the Housing Market in Houston Right Now?

The Houston Association of Realtors reported the number of single-family home sales in the Houston metro area rose 9.2 percent compared to the first quarter last year. Median home prices in Houston are up 3% from a year ago and sit at $340,000. The Texas Real Estate Research Center at Texas A&M University uses a larger area for metropolitan Houston and they reported a 1.9% increase in the median home sales price at $325,990. A median price is when half the prices are lower and half the prices are higher. Active listings on the MLS (home sellers) are up 30.5% from the end of the first quarter in 2023. The 3.7 Months of Inventory is below historical levels but it is a significant improvement over 2.6 from the end of the first quarter in 2023. Most real estate experts believe that a 4 to 6 month housing supply is a “normal” market that provides opportunities for both home buyers and home sellers. And the Days on Market is down 6 days to 89 days.

The beginning of 2024 was less than encouraging but then people started making decisions to buy or sell. The result was a pleasant spring season for Houston home buyers because there had been so little inventory the past few years. Home sellers were able to ask for and receive higher selling prices. All housing price segments saw an increase in sales. The strongest results were in the high end of the housing market.

A report distributed by the Houston Association of Realtors listed the April 2024 sales by price segment. These statistics show which housing segments had the largest increase in sales. Unsurprisingly the lowest prices houses, those under $150,000 had the largest increases in sales from this time last year.

$1 – $99,999: increased 24.3 percent
$100,000 – $149,999: increased 20.9 percent
$150,000 – $249,999: increased 2.2 percent
$250,000 – $499,999: increased 6.1 percent
$500,000 – $999,999: increased 14.0 percent
$1M and above: increased 33.8 percent

Is Houston Real Estate Overpriced?

No, according to the Greater Houston Partnership. When housing costs in Houston are compared to housing costs in other large metro areas in the United States the numbers are startling. Houston’s housing costs are approximately 85% below the average of these cities. Of course this comparison includes expensive cities such as New York and San Francisco. When compared to the national average Houston’s housing costs are 17.8% lower, ranking second lowest among all the large cities. Lower housing costs contribute to the overall lower living costs in Houston, which are 29.2% lower than the larger city average.

Houston’s real estate statistics are often compared to those of Dallas to confirm trends are statewide. Dallas also reported positive numbers ending in the first quarter of 2024. Median home prices were up 1.4% from a year ago with the median sales price being $390,000. The 3.0 Months of Inventory was up significantly from 2.1 a year ago. Active MLS listing were up 34.8% and Days on Market were 6 days less at 89 days.

Condominium and Townhome sales usually lag the single-family housing market. During economic downturns they typically are the first category of residential housing to lose value and during economic upturns they typically are the last to gain value. This is currently true in Houston. Demand is weak for condominiums and townhomes and inventory levels grew to 4.5 months, which is the highest level in four and one half years. Year-over-year sales and prices are also weak with a 1.3% decline in sales and a 1.8% decline in prices to $230,000.

We buy houses such as this one in any condition with 100% cash.

Does Houston have a Housing Problem?

Yes. Demand for affordable residential housing is greater than supply and has been for some time. According to Habitat for Humanity Houston ranks #5 out of six state with the most severe housing shortages. One of the key driving forces of this situation is that Houston offers employment opportunities and has had an expanding population for decades. In addition, the lack of lower priced, affordable housing contributes to the problem.

Houston Home Buyers and its associates and investors remodel, rehab, rent, sell, and return housing stock to the residential market in the Houston metro area.

 

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