The Houston housing market is experiencing a resurgence, bringing optimism as we approach the end of the year. With improving sales, diverse market segments performing well, and favorable conditions for buyers, the Houston real estate landscape appears promising for 2024.
How is the Houston housing market doing currently?
According to the Houston Association of Realtors' (HAR) November 2023 Market Update, single-family home sales across Greater Houston rose by a notable 4.9 percent. This marks the first increase since March 2022. Despite a decline when compared to pre-pandemic levels in November 2019, the market has shown resilience.
The market is seeing strength in the rental market for both single-family homes and townhomes/condominiums. Only homes priced below $150,000 experienced declines, whereas homes priced between $250,000 and $500,000 rose by a significant 8.0 percent year-over-year.
Optimistic Outlook
Cathy Treviño, HAR Chair from LPT Realty, expressed her optimism for the Houston housing market. She highlighted the crucial role of interest rates in driving home sales and expressed hope that consumer confidence would be restored in the new year. With improving inventory and moderated prices, favorable conditions for buyers are expected.
Price Movements
The average price of a single-family home in Greater Houston edged up by 1.0 percent to $404,597, while the median price notched downward by 1.2 percent to $326,000. Although these figures are below the record highs of May 2022 and June 2022, they signify a moderation in pricing trends.
November Monthly Market Comparison
November marked a significant turning point for the Houston housing market. Single-family home sales were in positive territory for the first time in 19 months, with sales rising by 4.9 percent year-over-year. Total property sales also rose by 3.7 percent, reaching $2.9 billion. Additionally, single-family pending sales rose by a noteworthy 11.9 percent. These numbers indicate positive momentum in the market.
Houston Single-Family Homes Overview
In November 2023, the Houston housing market witnessed a significant turnaround in the single-family home segment. Sales increased by 4.9 percent year-over-year, with 6,154 units sold across the Greater Houston area. Pricing trends have also moderated, with average and median prices showing slight changes.
Days on Market, representing the time it took to sell a home, slightly decreased from 48 to 47 days. Months of inventory expanded to a 3.5-month supply, matching its level in October 2023. This represents the greatest supply of homes in four years.
Houston Townhouse/Condominium Market Trends
In contrast to the positive trends observed in the single-family home market, the townhouse and condominium segment in Houston continued to face challenges in November. Sales volume decreased by 3.0 percent year-over-year, marking the 18th consecutive monthly decline. However, there are signs of improvement, as this decline is the smallest rate since June 2022.
The average price of townhomes and condominiums rose by 7.3 percent to $272,382, and the median price jumped by 11.4 percent to $245,000. Despite the decline in sales, these price movements indicate appreciation in property values. The inventory for townhomes and condominiums also expanded, suggesting a potential shift in market dynamics.
Houston Housing Market Forecast 2023-2024
As of November 30, 2023, the Houston housing market is undergoing notable shifts, with insights derived from Zillow providing valuable information for both buyers and sellers. Here's a detailed breakdown of the latest housing data:
- Average Home Value: $300,667
- Change Over the Past Year: Down 1.1%
- Days to Pending: Around 25 days
- 1-Year Market Forecast (Nov 30, 2023): -2.0%
- For Sale Inventory (Nov 30, 2023): 23,047
- New Listings (Nov 30, 2023): 6,010
- Median Sale to List Ratio (Oct 31, 2023): 0.986
- Median Sale Price (Oct 31, 2023): $319,333
- Median List Price (Nov 30, 2023): $355,283
- Percent of Sales Over List Price (Oct 31, 2023): 18.9%
- Percent of Sales Under List Price (Oct 31, 2023): 60.7%
Given the data, the Houston housing market appears to favor buyers. The 1-year market forecast indicates a -2.0% decline, suggesting a potential buyer-friendly environment in the coming months. With declining home prices and a substantial percentage of sales below list price, it may be a good time for prospective buyers to explore the Houston housing market.
Houston Rental Market Trends
The Zumper Houston Metro Area Report analyzed active listings last month across the metro cities, showing the most and least expensive cities and those with the fastest-growing rents. The median rent for a one-bedroom apartment in Texas was $1,136, with Sugar Land being the most expensive city at $1,400 and Huntsville as the most affordable city at $730.
The fastest-growing cities for rents in the Houston Metro Area, both year-over-year and month-over-month, include Huntsville, Pasadena, and Galveston.
Houston Real Estate Investment Outlook
Houston offers a promising landscape for long-term real estate investment. Factors such as economic resilience, population growth, infrastructure development, and real estate diversity contribute to its appeal. The city's track record of weathering economic challenges and proactive approach to urban development position Houston as an attractive destination for long-term real estate investors.
With its diverse range of investment opportunities, Houston allows investors to tailor their portfolios to their specific goals. The city's size and varied neighborhoods provide options for risk mitigation through portfolio diversification.
In conclusion, Houston's real estate market shows promise for long-term investment. As the city continues to grow and develop, it offers opportunities for sustainable and reliable returns to investors.
Images from the original article:
Source: Zillow
Credits: Zumper
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