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HOUSTON HOME PRICES HIT RECORD HIGHS AS THE MARKET WEATHERS MAY STORMS
Expanded inventory offers more options for buyers as market shows signs of moderation
HOUSTON — (June 12, 2024) — The Houston real estate market navigated a unique set of challenges in May. While severe weather and resulting power outages may have caused a delay in some closings, the market continued to see strong activity with expanding inventory and persistent consumer demand. This unwavering demand fueled record-breaking home prices in the Greater Houston area.
According to the Houston Association of Realtors’ (HAR) May 2024 Market Update, single-family home sales across the Greater Houston area declined 1.5 percent. The Houston Multiple Listing Service (MLS) recorded sales of 8,538 units compared to 8,664 last May. Months supply of homes climbed from 2.7 to 4.0, which is the highest since August 2019 when there was a 4.1-months supply.
The high end of the market saw the strongest performance in May. Home sales in the luxury segment ($1 million+), which represents just 4.8 percent of all homes on the market, climbed 9.6 percent. That was followed by the segment that consisted of homes priced between $500,000 and $1 million which rose 6.8 percent year-over-year. All other housing segments experienced a slowdown in sales last month. HAR will publish its May 2024 Rental Home Update on Wednesday, June 19.
The average price of a single-family home reached an all-time high in May of $443,970, topping the previous record in May 2022 when it reached $438,350. The average home price was up 3.6 percent year-over-year. The median price increased 1.5 percent to $345,000.
“The Houston market has demonstrated its adaptability yet again,” said HAR Chair Thomas Mouton with Century 21 Exclusive Properties. “While the weather disruptions may have impacted some sales, there continued to be strong activity with a rise in available listings and persistent buyer interest. We are beginning to see a more balanced market pace, benefiting both buyers with more options and sellers with sustained demand.”
May Monthly Market Comparison
Severe weather in the Houston area played a role in a slight decline in single-family home sales in May. Sales were down only 1.5 percent year-over-year as inventory reached the highest levels since before the pandemic in 2019.
Total property sales were also down 3.1 percent and total dollar volume was statistically flat at $4.3 billion. Single-family pending sales increased 1.8 percent. Active listings, or the total number of available properties, remains above last year’s level with 38.2 percent more listings for sale now than there were this time last year.
Months of inventory expanded from a 2.7-months supply last May to 4.0 months. Housing inventory nationally stands at a 3.5-months supply, according to the latest report from the National Association of Realtors (NAR). A 4.0- to 6.0-month supply is generally considered a “balanced market” in which neither buyer nor seller has an advantage.
Single-Family Homes Update
In May, single-family home sales declined 1.5 percent year-over-year with a total of 8,538 units sold across the Greater Houston area compared to 8,664 last May. The average price rose 3.6 percent to $443,970 while the median price was up 1.5 percent to $345,000.
Days on Market, or the actual time it took to sell a home, decreased from 49 to 45 days. Months of inventory increased to a 4.0-months supply compared to 2.7 months last May. The current national supply stands at 3.5 months, as reported by NAR.
Broken out by housing segment, May sales performed as follows:
$1 - $99,999: decreased 6.7 percent
$100,000 - $149,999: decreased 10.2 percent
$150,000 - $249,999: decreased 1.2 percent
$250,000 - $499,999: decreased 2.1 percent
$500,000 - $999,999: increased 6.8 percent
$1M and above: increased 9.6 percent
HAR also breaks out sales figures for existing single-family homes. Existing home sales totaled 6,225 in May, which is down 2.2 percent compared to the same time last year. The average price rose 6.1 percent to $456,769 and the median sales price increased 3.6 percent to $345,000.
For HAR’s Monthly Activity Snapshot (MAS) of the May 2024 trends, please click HERE to access a downloadable PDF file.
Townhouse/Condominium Update
In May, the inventory of townhomes and condominiums hit the highest level in nearly 12 years. Inventory grew from a 2.5-months supply last May to 4.7 months, which is the highest since October 2012 when it was 5.0 months.
Sales declined 9.8 percent year-over-year with 555 closed sales compared to 615 in May of last year. The average price of townhomes and condominiums rose 7.5 percent to a record high of $281,777 while the median price jumped 12.1 percent to $241,600.
Houston Real Estate Highlights in May
Single-family home sales declined 1.5 percent year-over-year;
Days on Market (DOM) for single-family homes went from 49 to 45 days;
Total property sales were down 3.1 percent with 10,175 units sold;
Total dollar volume was statistically flat at $4.3 billion;
The single-family median price edged up 1.5 percent to $345,000;
The single-family average price rose 3.6 percent to $443,970, which is a record high;
Single-family home months of inventory registered a 4.0-months supply, up from 2.7 months last May;
Townhome/condominium sales continued to decline, falling 9.8 percent, with the median price climbing 12.1 percent to $241,600 and the average price up 7.5 percent to $281,777.
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