The Houston single-family real estate market is up 3% in closed sales as compared to last year. Although the market is up from this time last year, July experienced a very sluggish home selling month
July single-family home sales declined by 25% from July 2009 and experienced 4,297 home sales. This dramatic decline from June to July indicates that the 2010 Tax Credit, [eligibility required a fully executed contract in place by April 30th] brought home buying demand forward that may otherwise occur during the summer months.
Paradoxically, immediately following the tax credit expiration, interest rates on mortgages declined dramatically. Buying a home today, rather than before the tax credit expiration, will save a buyer thousands of dollars on a lower interest rate. Savings over the life of the loan actually dwarfs the savings buyers received from a Tax Credit. This is good news for anyone in the Houston area looking for a home. There is a good supply of homes on the market and the interest rates are lower than have been experienced in decades.
Houston – one of the best employment performances in the nation.
According to the U.S. Bureau of Labor Statistics, Houston had the strongest employment gains in the nation during the past 5 years. Houston added 129,000 new private sector jobs between June 2005 and June 2010. At the same time, Houston suffered job losses, yet the Bayou City has added 31,000 jobs since January of this year. Houston is far ahead of the rest of the nation in terms of jobs and job creation and the region appears to be climbing its way back to normal market conditions. There is a direct correlation between jobs and the real estate market; as jobs increase, so does the demand for real estate.
A snapshot view of metrics for the month and year-to-date can be found below. July was a sluggish month in comparison to July 2009, yet year-to-date the statistics indicate this year is a stronger real estate year than 2009.
Here is a table overview of the month and year-to-date:
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Greater Houston MLS [HRIS] Single-Family Residential Real Estate |
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|
|
July 2010 |
July 2010 YTD |
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|
Metric |
Amount |
% Change From 6/09 |
Amount |
% Change From 7/09 YTD |
|
Sales |
4,297 |
-25% |
31,624 |
3% |
|
Dollar Volume Sold |
$965,810,908 |
-23% |
$6,638,644,482 |
7% |
|
Contracts written |
2,762 |
-17% |
20,370 |
-6% |
|
# of Listings |
34,625 |
24% |
31,301 |
12% |
|
Average Sales Price |
$224,764 |
3% |
$209,924 |
4% |
|
Median Sales Price |
$160,880 |
-1% |
$153,000 |
1% |
Sellers should stay tuned to their local market
In the last few months, Houston has experienced an inventory creep where more homes are coming on the market without a corresponding increase in buyer demand. While this gives buyers more to choose from, sellers should review their local market for what’s on the market versus how many homes are selling in various price ranges. Agents at Prudential Gary Greene, Realtors® have a system that automatically generates the aforementioned market stats as well as current online buyer demand. It enables a seller to analyze current sales and inventory but also how online buyer demand is trending. The program e-mails each seller a daily update so he/she is aware of their current market’s local activity. With information on hand, sellers can make quick adjustments to their marketing strategy that keep their home favorably positioned over the competition. Contact any of our agents under the “Find an Agent” tab on www.GaryGreene.com to learn more about our Online Sellers’ Advantage program.
What home price classes are the hottest selling in Houston through July YTD?
The following table indicates by price class the top ten hottest selling price ranges in Houston in 2010:
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Ten Hottest Selling Price Classes Houston Single-Family Real Estate June YTD 2010 |
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|
Price Class |
Sales YTD |
Active Listings |
Months of Inventory |
|
1. $200,000-$249,999 |
3,137 |
3,719 |
8.0 |
|
2 $300,000-$399,999 |
2,297 |
3,245 |
9.6 |
|
3. $250,000-$299,999 |
2,272 |
2,874 |
8.7 |
|
4. $120,000-$129,999 |
1,826 |
1,887 |
7.0 |
|
5. $130,000-$139,999 |
1,705 |
1,738 |
6.6 |
|
6. $110,000-$119,999 |
1,672 |
1,743 |
7.2 |
|
7. $140,000-$149,999 |
1,488 |
1,734 |
7.8 |
|
8. $150,000-$159,999 |
1,445 |
1,643 |
7.6 |
|
9. $90,000-$99,999 |
1,424 |
1,497 |
7.2 |
|
10$80,000-$89,999 |
1,418 |
1,240 |
6.3 |
As you can see from the table above, Houston’s hottest selling home prices range from $80,000-$399,999. What is also interesting to note is that the months of inventory, on even the hottest selling price classes has risen slightly every month since the Tax Credit expiration. This is a strong indicator that sellers should stay tuned to activity in their market area, and consider price adjustments to stay competitive.
The High-End Market is Still Hot.
The 2010 paradigm in Houston’s hottest selling home prices is the high-end market. Most price classes $80,000 and above have experienced single-digit increases in sales over last year. As you can see from the table below, most price classes over $500,000 have experienced double-digit increases in sales over last year. Contrary to norm, the higher the price class in 2010, the higher the percentage increase in sales, in most categories. Homes priced $900,000-$999,999 are up in sales by 33% over last year, the highest increase in sales of any price class. Homes priced $1,000,000 or more are up 15% over last year. This represents an incredible comeback from a gloomy high-end market in 2009.
Highest Price Class Increase Year-to-Date
1. $900,000-$999,999 up 33% year-to-date
2. $600,000-$699,999 up 22% year-to-date
3. $400,000-$499,999 up 22% year-to-date
4. $500,000-$599,999 up 17% year-to-date
5. $1,000,000 or more up 15% year-to-date
6. $800,000-$899,999 up 6% year-to-date
The Low-End Market is Not so Hot.
The other new 2010 paradigm in Houston’s hottest selling prices is the low-end market. The majority of price classes $70,000 and below are experiencing single to double-digit declines.
Keep in mind that these statistics are sweeping generalities of a large major metropolitan market. The Houston Metropolitan Statistical area covers over 10,000 square miles. Houston is so large, it is like a mosaic. Some areas are shining brightly while others are not as lustrous. For a breakdown of activity by area with a map of the area, go to http://garygreene.mediaroom.com/index.php?s=38&cat=14.
View the Houston Hotness Index for July 2010 at http://media.garygreene.com/index.php?s=38&item=221
This table displays the hottest selling areas in Houston. The hotness ratio is the current months “buyer demand” or pending sales as a percent of active listings.
To search for homes by price range, map and/or even foreclosures, go to www.GaryGreene.com.
It will be interesting to see what the last half of 2010 has in store for the real estate market. No matter what, the Houston area will remain one of the top real estate markets in the nation and our economy is positioned to withstand the winds of change far better than any other region in the United States.
Data provided by the Houston Association of Realtors® Multiple Listing Service, and The Real Estate Center for Texas A&M and written by Toni Nelson, Director of Strategic Initiatives for Prudential Gary Greene, Realtors®
Tags: Houston Home sales, Houston Real Estate, Houston Real Estate Market
