Sales volume and prices climb while the supply of homes remains low

HOUSTON — (February 11, 2015) — The Houston real estate market began 2015 much as it ended 2014 – with home sales and prices on the rise and housing inventory at historically low levels. The majority of January sales took place among homes priced between $250,000 and $500,000, with the pace of sales slowing significantly among homes priced above $500,000.

According to the latest monthly report prepared by the Houston Association of Realtors (HAR), single-family home sales totaled 4,032 units, an increase of 6.1 percent compared to January 2014. Months of inventory, the estimated time it would take to deplete the current active housing inventory based on the previous 12 months of sales, reached a 2.6-months supply versus a 2.7-months supply last January. That is markedly lower than the current national supply of 4.4 months of inventory.

Home prices achieved record highs for a January. The average price of a single-family home jumped 7.0 percent year-over-year to $259,969. The median price—the figure at which half the homes sold for more and half for less—rose 6.7 percent to $190,000.

January sales of all property types totaled 4,874 units, a 2.6-percent increase compared to the same month last year. Total dollar volume for properties sold rose 9.0 percent to $1.2 billion versus $1.1 billion a year earlier.

“January was a strong month overall for the Houston housing market, but we still expect to see sales cool as a result of lower oil prices and the limited supply of homes,” said HAR Chair Nancy Furst with Berkshire Hathaway HomeServices Anderson Properties. “We’ve already started to see declining townhome and condominium sales. Coming off a record year, this normalization should give homebuilders an opportunity to create new inventory, with existing homes entering the market in the spring and summer months, which is traditionally the most popular time for owners to sell.”

January Monthly Market Comparison

The Houston real estate market grew in all categories in January, with total property sales, total dollar volume and average and median pricing all up when compared to January 2014.

Month-end pending sales for all property types totaled 3,382. That is down 9.3 percent compared to last year and portends slower sales activity when the February numbers are tallied. Active listings, or the number of available properties, at the end of January was 26,556, down 5.9 percent from last year.

Houston’s housing inventory reached a 2.6-months supply in January. It wasn’t much higher a year earlier when it stood at a 2.7-months supply. According to the National Association of Realtors, the current supply of homes for the U.S stands at a 4.4-months supply.

* Months inventory estimates the number of months it will take to deplete current active inventory based on the prior 12 months sales activity. This figure is representative of the single-family homes market.

Single-Family Homes Update

January single-family home sales totaled 4,032, up 6.1 percent from January 2014.

Home prices reached record highs for a January in Houston. The single-family average price increased 7.0 percent from last year to $259,969 and the median price climbed 6.7 percent year-over-year to $190,000. The number of days it took a home to sell¬, or Days on Market, was 57 versus 65 last January. In July 2014, it fell to an historic low of 45 days.

Broken out by housing segment, January sales performed as follows:

• $1 - $79,999: decreased 20.4 percent
• $80,000 - $149,999: decreased 11.2 percent
• $150,000 - $249,999: increased 10.7 percent
• $250,000 - $499,999: increased 14.9 percent
• $500,000 and above: increased 3.2 percent

HAR also breaks out the sales figures for existing single-family homes. In January, existing home sales totaled 3,454. That is up 7.7 percent from the same month last year. The average sales price climbed 8.1 percent year-over-year to $242,220 while the median sales price rose 6.9 percent to $175,000.

Townhouse/Condominium Update

Sales of townhouses and condominiums declined 20.0 percent in January versus one year earlier. A total of 337 units sold last month compared to 421 properties in January 2014. The average price rose 6.2 percent to $183,906 and the median price rose grew 5.4 percent to $141,000. Inventory held at a 2.5-months supply.

Lease Property Update

Demand for lease properties was mixed in January. Single-family home rentals edged up 2.2 percent compared to January 2014, while year-over-year townhouse/condominium rentals fell 4.1 percent. The average rent for a single-family home was up 3.3 percent to $1,665 and the average rent for a townhouse/condominium rose 3.3 percent to $1,547.

Houston Real Estate Milestones in January

• Single-family home sales rose 6.1 percent versus January 2014;
• Total property sales were up 2.6 percent year-over year;
• Total dollar volume increased 9.0 percent, from $1.1 billion to $1.2 billion on a year-over-year basis;
• At $190,000, the single-family home median price achieved a record high for a January;
• At $259,969, the single-family home average price also reached a January high;
• Days on Market for single-family homes was 57 days;
• Rentals of single-family homes rose 2.2 percent year-over-year and the cost of renting those homes increased 3.3 percent to $1,665.

The computerized Multiple Listing Service of the Houston Association of REALTORS® includes residential properties and new homes listed by 29,000 REALTORS® throughout Harris, Fort Bend and Montgomery counties, as well as parts of Brazoria, Galveston, Waller and Wharton counties. Residential home sales statistics as well as listing information for more than 50,000 properties may be found on the Internet at https://www.har.com.

The information published and disseminated to the HAR Multiple Listing Services is communicated verbatim, without change by Multiple Listing Services, as filed by MLS participants.

The MLS does not verify the information provided and disclaims any responsibility for its accuracy. All data is preliminary and subject to change. Monthly sales figures reported since November 1998 includes a statistical estimation to account for late entries. Twelve-month totals may vary from actual end-of-year figures. (Single-family detached homes were broken out separately in monthly figures beginning February 1988.)

Founded in 1918, the Houston Association of REALTORS® (HAR) is a 29,000-member organization of real estate professionals engaged in every aspect of the industry, including residential and commercial sales and leasing, appraisal, property management and counseling. It is the largest individual dues-paying membership trade association in Houston as well as the second largest local association/board of REALTORS® in the United States.