Houston real estate market soars again in October

Even with an ever-dwindling supply of housing and a lingering pandemic, consumers bought homes at a frenzied pace in October, keeping the Houston real estate market on the path to a record year. The high end of the market once again registered the greatest sales volume increase, with mid-range homes also attracting heavy activity.

According to the latest Houston Association of Realtors (HAR) Market Update, 9,287 single-family homes sold in October compared to 7,187 a year earlier. That represents a 29.2 percent increase and marks the fifth straight month of positive sales. Homes priced at $750,000 and up surged 81.6 percent compared to October 2019. That was followed by the $500,000 to $750,000 housing segment, which jumped 78.4 percent year-over-year. Homes between $250,000 and $500,000, which make up the market’s biggest share of sales, also achieved notable increases over last year.

The single-family home median price rose 11.1 percent to $266,685 while the average price increased 12.4 percent to $334,996. Both figures are record highs for an October. Year-to-date sales are currently 7.7 percent ahead of 2019’s record pace.

Sales of all property types totaled 11,232 — up 31.5 percent from October 2019. Total dollar volume for the month rose 46.1 percent to $3.5 billion. The lease market had mixed results in October with a 5.1 percent decline in single-family housing while townhouse/condo leases jumped 11.0 percent.

“There was no way to anticipate that the Houston housing market would move at such incredible velocity when coronavirus struck, but I believe it is a testament to the importance of meeting consumers’ housing needs during a pandemic and the dedication of hard-working real estate professionals throughout our community,” said HAR chair John Nugent with RE/MAX Space Center.

October delivered a mixed performance for Houston’s lease property market. Leases of single-family homes fell 5.1 percent yearover-year while leases of townhomes and condominiums were rose 11.0 percent. The average rent for single-family homes increased 6.2 percent to $1,907, while the average rent for townhomes and condominiums increased 3.5 percent to $1,595.

Consumers snapped up what few homes were available, continuing to seize upon historically low mortgage interest rates even as COVID-19 cases nationwide began to climb. Houston real estate marked its fifth consecutive month of positive sales. On a year-to-date basis, the market is now running 7.7 percent ahead of 2019’s record pace. Single-family home sales, total property sales and total dollar volume all increased compared to October 2019. Pending sales shot up 38.6 percent. However, total active listings — or the total number of available properties — fell 25.9 percent.

A continued slowdown of new listings entering the market combined with another vibrant month of sales sent single-family homes inventory down to a 2.4-month supply compared to 3.8 months a year earlier. The last time inventory dropped that low was in December 2014. For October, new listings rose just 2.5 percent year-over-year. Housing inventory nationally stands at a 2.7-month supply, according to the National Association of Realtors (NAR).

Single-family home sales soared 29.2 percent in October with 9,287 units sold throughout the greater Houston area compared to 7,187 a year earlier. On a year-to-date basis, sales are outperforming last year’s record volume by 7.7 percent. Strong sales volume in the upper segment of the market once again pushed pricing up. The singlefamily home median price rose 11.1 percent to $266,685 while the average price increased 12.4 percent to $334,996. Both figures are historic highs for an October.

Days on Market (DOM), or the number of days it took the average home to sell, dropped from 59 to 47. Despite a 2.5 percent increase in newlistings in September, inventory registered a 2.4-month supply compared to 3.8 months a year earlier and is near levels last seen almost six years ago, in December 2014.

Broken out by segment, October sales are: $1 - $99,999: decreased 32.7 percent; $100,000 - $149,999: decreased 27.4 percent; $150,000 - $249,999: increased 12.2 percent; $250,000 - $499,999: increased 52.5 percent; $500,000 - $749,999: increased 78.4 percent; and $750,000 and above: increased 81.6 percent.