Houston’s current inventory is down 20% from this time last year, with 27,951 single-family homes on the market. This is contrary to the national scene depicting an overabundance of homes on the market and record foreclosures. What has changed in Houston over the last year has been the hotness of price classes. Last year, homes on the market priced over $400,000 were in high demand and today, the hottest selling home prices have moved more toward the center of the price class spectrum. High-end home sales have slowed. In just one year, homes priced $1 Million and over have moved from a 28% increase in number of sales to a double digit decline in sales [-44%] with 22.8 Months of Inventory. The graph depicted below displays the top ten hottest selling home prices for the First Quarter of 2009 based on number of home sales by price class.
The Top Ten Hottest Selling Price Classes of single-family homes in Houston for First Quarter 2009 are:
|
Price Class |
Sales Year to Date |
Active Listings |
Months of Inventory |
|
1. $200,000-$249,999 |
951 |
2,806 |
6.2 |
|
2. $250,000-$299,999 |
636 |
2,390 |
7.8 |
|
3. $120,000-$129,999 |
608 |
1,269 |
4.6 |
|
4. $300,000-$399,999 |
601 |
2,795 |
8.4 |
|
5. $130,000-$139,999 |
584 |
1,262 |
4.7 |
|
6. $110,000-$119,999 |
553 |
1,321 |
5.2 |
|
7. $80,000-$89,999 |
518 |
910 |
4.4 |
|
8.$100,000-$109,999 |
510 |
848 |
4.1 |
|
9. $90,000-$99,999 |
492 |
1,123 |
5.7 |
|
10. $70,000-$79,999 |
769 |
769 |
4.8 |
As you can see, most of the top 10 selling price classes have a healthy months of inventory and many will enjoy single digit appreciation. Also, it can be observed in the graph that the higher the price class, the higher the number of listings and the higher the months of inventory. However, the fact that these higher price classes made the Top Ten Selling Price Classes in the First Quarter indicates their higher months of inventory will decline over the Spring and Summer months.
In comparison to last years’ First Quarter, single family homes are experiencing the following:
• Sales are down 21% over First Quarter 2008 with 10,616 sales
• Dollar volume is down 28% over First Quarter 2008 with $1,928,552,302, [which we attribute more to the 44% decline in sales priced over $1 Million.]
• Average sales price is $181,665 or 10% lower than First Quarter last year.
• Median sales price is $138,000 or 7% lower
• Pending sales are 8,794 or 21% lower than last year
• Active listings are 27,951 or 20% lower than last year.
There are two things to keep in mind when reviewing the above First Quarter Comparison:
- We are comparing this year to the third best year in Houston residential history.
- Every metric noted above is an improvement from February year-to-date, so with each month that passes, Houston real estate is improving.
As we approach the Spring market, most economists predict that the country will pull out of a recession by September. Consumer confidence is up. Houston will be one of the first markets to emerge from the recession because it was never a market built on speculation. Houston has not nor will it experience rising unemployment. Houston just could not innoculate itself from the lack of confidence in the national economy or the uncertainty that prevailed in the First Quarter of 2009.
Houston home buyers can capitalize on an $8,000 tax credit for first-time home buyers through the economic stimulus package, and interest rates are at record lows. These factors together with Houston’s positive employment base and affordable housing should stimulate home sales during the Spring market. Prudential Gary Greene, Realtors® anticipates that April sales will exceed every month’s sales found in the First Quarter, a time frame wrought with economic insecurity and a barrage of bad news. Restoring those two psychological factors, confidence and a greater sense of security, will go a long way toward restoring Houston real estate to a more vibrant real estate market.
