Houston real estate shows strength, stability in August

After the Houston housing market’s 13-month run of positive sales was abruptly interrupted in July, August saw a return to increased sales volume with inventory levels improving and prices showing signs of moderation while remaining higher than last year. These trends were facilitated by an influx of new listings and strong ongoing buyer demand. July’s sales decline was an anomaly with volume that could not rival the unprecedented surge of closings in July 2020 following COVID-related market disruptions.

According to the Houston Association of Realtors (HAR) August 2021 Market Update, single-family homes sales rose 8.5 percent versus last August, with 9,890 units sold.

That is up from 9,118 sales in August 2020. On a year-to-date basis, local home sales are 17.4 percent ahead of 2020’s record pace.

Homes priced from $500,000 to $750,000 held the lion’s share of sales volume with a 48.5 percent year-over-year increase. That was followed by the $250,000 to $500,000 segment, which rose 31.8 percent. The luxury segment, comprised of homes priced at $750,000 and above, saw a 30.5 percent year-over-year jump in sales. The singlefamily home average price increased 14 percent to $380,233 and the median price climbed 15.2 percent to $310,000. Pricing has eased a bit since setting record highs in June.

Sales of all property types rose 9.2 percent year over year, totaling 12,036. Total dollar volume for August shot up 26.7 percent to $4.3 billion.

“The Houston housing market is beginning to show signs of easing, which was to be expected with summer behind us, schools back in session and inventory levels still exceptionally low, albeit improving,” said

HAR Chairman Richard Miranda with Keller Williams Platinum. “We are also hearing anecdotally that there aren’t quite as many competitive bids on property listings as we observed earlier this year, which drove prices into record territory in June.”

The June “Close to Original List Price Ratio” for single-family homes was the highest ever — 100.3 percent — with a majority of buyers paying above list price for homes on the market. In July, it was 100.2 percent, however in August, it retreated to 99.6 percent, supporting reports that the high-dollar buying trend is cooling.

Consumer demand for lease properties was mixed in August while rent prices were up. Single-family lease homes fell 10.2 percent year over year. Leases of townhomes and condominiums edged up 1.8 percent. The average rent for single-family homes rose 9.6 percent to $2,153, while the average rent for townhomes and condominiums increased

6.9 percent to $1,765.

The Houston housing market returned to positive territory in August after July ended a 13-month stretch of sales gains due to a surge in pandemic-delayed home closings in July 2020 that outpaced the current market. In August, single-family home sales, total property and total dollar volume all rose. Pending sales increased 8.9 percent. However, total active listings — or the total number of available properties — fell 14.4 percent compared to the same time last year.

Single-family homes inventory reached a 1.9-month supply in August. While that is

down from 2.6 months a year earlier, that is the biggest supply of homes the market has had in 2021 and reflects a 10.9 percent increase in new listings. Housing inventory nationally stands at a 2.6-month supply, according to the latest report by the National Association of Realtors (NAR).

August single-family home sales quickly rebounded from July’s negative report, climbing 8.5 percent with 9,890 units sold across the greater Houston area compared to 9,118 a year earlier.

The single-family home average price increased 14 percent to $380,233, while the median price jumped 15.2 percent to $310,000. Those figures are below record high pricing set in June 2021.

The time it took to sell a home was nearly cut in half versus August 2020. Days on Market (DOM) went from 51 to 26. Inventory registered a 1.9-month supply compared to 2.6 months a year earlier. That level is the highest of 2021, but is below the current national inventory of 2.6 months recently reported by NAR.

By housing segment, August sales per

formed as follows:

• $1 - $99,999: down 32.4 percent

• $100,000 - $149,999: down 33.5 percent

• $150,000 - $249,999: down 26.6 percent

• $250,000 - $499,999: up 31.8 percent

• $500,000 - $749,999: up 48.5 percent

• $750,000 and above: up 30.5 percent

Existing single-family home sales totaled 8,584 in August. That is up 14.7 percent from the same month last year. The average sales price rose 13.2 percent to $375,354, while the median sales price climbed 16.9 percent to $304,000.