Houston Real Estate Sees Rise in Home Inventory
July brought a shift to the Houston real estate market, with slowing home sales amid rising home inventory. According to data released by the Houston Association of Realtors, reported by the Houston Business Journal, home inventory now stands at a 4-month supply. This means at the current pace of sales, it would take 4 months to sell all the homes currently on the market, if no new properties were added.
This marks the highest home inventory since November 2012, when home inventory stood at 4.1 months of supply. Yet Houston remains ahead of the national real estate market, which is averaging 4.6 months of supply.
While home sales have slowed, median home prices in Houston have remained strong. During June, median home prices reached $233,000, the highest on record. During July, median home prices were $230,000, which was 4.1% higher than July of last year.
The slowdown in Houston home sales has affected all price ranges to varying degrees. The most resilient segment of the market are homes priced between $150,000 and $499,999. This remains the “sweet spot” in Houston real estate, being the most popular price range for first-time buyers, move-up buyers, and other owner-occupants.
Surprisingly, the price tiers with the sharpest decline in sales include homes priced under $80,000, and homes priced between $80,000 and $149,999. Houston luxury real estate, including homes priced at $500,000 and up, continues to experience softer home sales in the face of weakening demand.
Given the price tiers most affected by slowing sales, it can be speculated that real estate investors are heading to the sidelines, following the lead of affluent home buyers. A contentious election year may be compounding economic uncertainties created by slumping oil and the impacts of “Brexit.” Nationwide, the luxury home market has been considerably softer than last year, and the current uptick in home inventory is not exclusive to Houston.
Please remember that all real estate is local, and that sales trends and market activity will vary from one neighborhood to another! For more information about Houston real estate, contact the KW Energy Corridor Team!
KW Energy Corridor Team
11757 Katy Fairway | Suite 930
Houston, TX 77079