Home sales in Houston mark first dip in months
Market is still strong; inventory hits 7-year high
Single-family home sales declined in June, the first such dip in five months, and inventory hit a nearly seven-year high, new data show.
Buyers closed on 8,097 homes last month, a robust number to launch the summer selling season but a 3.4 percent dip from June 2018, according to figures released Wednesday in a monthly report from the Houston Association of Realtors.
To beat the 8,385 sales recorded last June would have been besting the all-time high for home sales. And on a year-to-date basis, singlefamily sales are still outpacing last year’s record volume by 1.4 percent.
For most of this year, the market has been fueled by low mortgage rates, a greater supply of properties for sale and a healthy local economy. But homes in the $250,000 to $500,000 price range were the only segment of the market to see sales gains last month.
Lorna Wells got an offer on her family’s 3,000-square-foot house in the northeast Houston community of Summerwood the first day it hit the market. She listed the house because her husband, a professional musician, needed more room for his work. They also have three growing boys.
“We thought it would sell pretty quickly, but we didn’t think it would sell as quickly as it did,” said Wells, 33. “There were quite a few houses for sale when we sold ours.”
The couple listed the house for just under $320,000 and ended up selling it for about $10,000 more than when they bought it two years ago. They closed on the sale in June and are having a new
home built nearby.
Some would-be buyers are putting off purchasing homes in favor of renting. Demand for single-family and townhouse rentals has been growing for months, as some first-time homebuyers are priced out of the for-sale market or simply want a more flexible lifestyle.
“Our buyer agents are freaking out because we don’t have the number of leads we had two months ago,” said Lance Loken of the Loken Group. “In March, April and May, the doors were knocking down with buyers. They’re starting to really slow down.”
Before agents host open houses, Loken encourages them to go door-to-door to let the neighbors know the house will be open because some are likely to have friends who are looking in the neighborhood.
“It’s really effective,” he said of the door-knocking approach. “Especially in this heat, because no one else is doing it.”
While the overall supply of single-family for-sale housing is still below the 6-month mark experts generally view as a balanced market, in which neither buyer nor seller have the upper hand, inventory has been rising.
Months inventory — the amount of time it would take to sell all the listings on the market based on the past year of sales — inched up to 4.4 months, the highest since October 2012, from 4.1 a year earlier. And single-family listings, which have been rising most of the past year, reached 30,222, an amount not seen since 2011.
But on a more granular level, the market appears to be tilted in favor of buyers on the high end — where the supply of homes priced between $750,000 and $1 million is more than 10 months. Inventories on the low end are generally between two and four months, according to the realty data, which is based on sales throughout primarily Harris, Fort Bend and Montgomery counties handled through the association’s Multiple Listing Service.
Despite the slowing of sales, the median price in June of $252,000 was up 2.9 percent over a year ago, outperforming the previous month’s record.
“We knew it would be difficult to top last June’s record-breaking sales volume, but the Houston real estate market remains strong and now offers prospective buyers an even greater selection of housing than they’ve had in some time,” Shannon Cobb Evans, the association’s chair, said in a statement.
While the single-family market remains healthy, townhouse and condominium sales are struggling. This market segment, where sales volume has declined in all but one month this year, plunged 16.2 percent from the 697 posted a year earlier. Inventory grew to 4.9 months, compared with 4.2 in 2018. The median price, however, increased 8.7 percent to $177,250.