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Mar 23

Houston's Changing Housing Market

by Mary Teresa Fowler
Houston Real Estate Market Update

Houston’s housing market is an ever-changing scene and varies throughout the region. The latest report indicates that median home prices in this Texas city were never as high as in February 2011. Houston is going against the general trend across the country.

High Median Sales Price

Although the single family median sales price is $151,900 (up 3.9% from last year), sales were down somewhat in Houston. Average prices rose 6.6% but home sales fell 4.4%. In January, Houston's home sales had risen for the first time in seven months. The sales figures for the first month of 2011 set an optimistic tone.

No Sales Surge

Indeed, February delivered with its high median prices due to luxury and low-end market purchases. Yet during February, there was not a repeat of the sales surge of the previous month. Houston experienced 3,906 home sales in February – a fall of 24.7% from January and 16.5% from 2010.

Higher Prices

Of course, spring and summer are promising times for housing in general. Yet industry leaders wonder how gas prices (almost $4) will affect Houston’s housing in the near future. Probably affluent buyers might search regardless of gas prices. Many first-time home buyers, however, will find high gas prices to be straining on their budgets. H.A.R. Vice Chariman Danny Frank believes it is possible that rising gas prices will affect how people search for housing.

Potential Boost

Area realtors are optimistic but housing in the greater Houston area is not yet reaching its full potential. Compared to this time last year, housing prices have increased but there has been a drop in sales. Of course, during this period in 2010, home buyers could take advantage of the federal tax credit. That specific incentive was a boost to housing in Houston during the first part of 2010. Now Houston’s housing has to operate more on its own strength. Today’s numbers give a more accurate representation of the city’s actual housing market.

Improving Economy

According to the Texas Work Force Commission, however, employment is rising in the Houston-Sugarland-Baytown region. Indeed, within the past year, this particular area saw an increase of 56,600 jobs. Obviously, the improving Houston economy is attracting people (and potential home buyers) from across the country.

With its prices and low interest rates, Houston is a buyers’ market. Even if home buyers have less money than a few years ago, the funds will go further when buying property in Houston. People are getting more housing value for their money with the current economy in this thriving city.

Luxury Market

Erik Barajas of the local KTRK-TV news team reports an increase of over 10% in sales for houses selling between one quarter and one half million dollars. In fact, the Houston Business Journal notes that the high-end housing market ($500,000 and over) in Houston is driving the city’s home sales. Of course, the majority of potential home buyers are not able to afford properties costing in excess of half a million dollars. Yet there are buyers ready to take on multi-million dollar homes in Houston.

What Do You Think Makes Houston A Unique Housing Market?

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ABCLocal.com; What's the status of Houston's housing market?; March 16, 2011

HousingWire.com; Houston home sales dip after strong January; Kerri Panchuk; March 16, 2011

Image courtesy of biggerpockets.com

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