Houston home sales set records as average price nears $400,000

Home prices in Houston topped last year’s highs in February as a lack of homes on the market, especially in the more affordable price ranges, continued to push buyers to increase their budgets.

The median price of single-family homes rose 19.3% over the year to a record high of $328,000 in February, eclipsing the previous December’s record high of about $10,000, according to the Houston Association of Realtors. . Meanwhile, the average selling price jumped 13.4% to $395,871 in February, topping the previous high of $393,295 set in June.

Single-family home sales jumped 22.9% to 7,372 units sold from 5,997 in February 2021, when sales were stalled by a freeze and power outages that shut down much of the city. Sales volume, however, was up 23.3% from February 2020, one of the last normal months before the pandemic began to rock the real estate market.

The supply of homes on the market fell to a 1.3-month low in February, matching the all-time low of May 2021. Inventory by month represents the time it would take to sell the homes on the market at the rate current. Six months is considered a balanced market where neither buyer nor seller has the upper hand.

“Last year’s freeze may have skewed February sales numbers, but the fact remains that home sales throughout Houston continue to rise despite the challenges posed by limited inventory, record prices and rising interest rates,” said HAR President Jennifer Wauhob of Better Homes. and Gardens Real Estate Gary Greene said in the report. “We are watching closely to see how the local real estate market could be affected this month by soaring oil prices and some of the other economic fallout from the Russian-Ukrainian conflict.”

Rising oil prices – which rose above $120 a barrel before falling back below $110 on Wednesday – could draw more buyers into the market by boosting the region’s important energy industry – depending on how long for which prices are maintained.

“In the past, when oil prices were high for a long time, there were more people transferred and oil companies hired more people,” said Steve Hardcastle, a broker at Re/Max Signature. “They are much more careful now.”

Hardcastle says home prices have risen 20% over the past two years in some neighborhoods where it sells in Cypress, Katy and Energy Corridor.

“It’s a real challenge for a buyer to find a home and be able to compete with all the other buyers who are looking for the same home,” he said. “But the sellers are doing well.”

According to the Houston Association of Realtors, the volume of sales of homes priced below $250,000 has fallen due to a lack of supply in the market.

Sales of homes priced between $250,000 and $500,000 jumped 80% in February from a year earlier. Homes from $500,000 to $1 million were the second most active segment, with sales up 72.3%. the the number of sales of luxury homes at $1 million and over increased by 33.5%.

Inventory was tightest for homes between $200,000 and $249,999, with less than a month’s supply, according to the real estate association.

Homes, on the other hand, spend less time on the market. In February, the average time on the market decreased by one week to 41 days in February.

Ted C. Jones, chief economist at Stewart Title, says the sharp rise in prices is due to strong demand and low interest rates. With a 30-year fixed mortgage rate averaging 3.76%, the principal and interest on a $229,000 loan is around $1,000 per month, making the purchase a good choice. if you plan to stay in the house at least three years, Jones said.

“The greatest storehouse of wealth for the middle class is their home,” Jones said. “If you don’t buy that house, you don’t get that equity.”

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