Area’s home prices up 30% since 2000

DENVER — Houston-area home prices have increased nearly 30 percent since 2000 and 3.6 percent since their previous peak in the fall of 2006, according to new data to be released Friday by the Joint Center for Housing Studies at Harvard University.

“The rise in house prices has been tremendously widespread,” Chris Herbert, the center’s managing director, told members of the National Association of Real Estate Editors at its annual conference this week.

Harvard researchers found that 97 of the nation’s 100 largest metropolitan areas saw home price gains last year, while longer-term gains varied

widely with some markets seeing home price appreciation of more than 50 percent.

A decade after the start of the Great Recession, the nation’s housing market has “returned to normal,” Herbert said, though growing demand and tight supply continue to fuel concerns about affordability.

On a local level, Houstonians are feeling strained as home prices have soared amid pent-up demand and tight supplies.

Local job growth, which has seen more gains recently in lower-paying service and hospitality industries than once-booming high-paying energy jobs, has exacerbated the problem.

Houston-area home sales surged last month, spiking 11.5 percent from a year ago, the Houston Association of Realtors reported this week. The region’s median sales price hit an all-time high of $235,000.

Nationwide, home prices increased 32 percent between 2000 and 2016 with prices rising by 40 percent or more in 153 metros, the Harvard data show.

In 12 metros, home prices doubled. Prices declined in about 280 metros.

The study included market-specific data on affordability, as well.

“Aging will be a huge issue of the housing market going forward.” Chris Herbert, managing director of Joint Center for Housing Studies

In the Houston area, 63.7 percent of households can afford the median-priced existing single-family home of $212,000, while 45 percent of renter households can afford the median rent of $1,300.

“Affordable” means house payments cannot exceed 36 percent of the monthly household income.

Herbert stressed the need for different types of housing.

By 2035, one out of every three households will be 65 and older.

“Aging will be a huge issue of the housing market going forward,” he said.

So will millennials, who as they move into their late 20s and early 30s will propel demand for entrylevel homes and rental housing, the report notes.

“We’re not seeing home builders build entrylevel homes,” Herbert said.