April another down month for Houston home sales as prices finally begin to soften - Houston Public Media
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The newest twist affecting Houston’s housing market is falling prices. HAR says the median price of a home in Houston declined 3.6% last month, to $331,000, the second straight month of lower prices.
Houston's post-pandemic housing market hangover continued in April, with home sales down for the 13th consecutive month. In a new report released Wednesday, the Houston Association of Realtors said home prices dipped more than 18% last month compared to the same month in 2022.
"Interest rates are rising, taxes are rising, it's just a domino effect," HAR Chair Cathy Trevino said. "Insurance is rising, so all of these have an impact on your final payment and it is putting a crunch onto a lot of buyers."
The newest twist affecting Houston's housing market is falling prices. HAR says the median price of a home in Houston declined 3.6% last month, to $331,000, the second straight month of lower prices. The average price of a home dropped 1.6%, to $419,929. That's compared to more than $438,000 in May of last year, a record for Houston.
Other markets, like Austin and cities on both coasts, have seen far more dramatic price swings over the past few months. But any sign of softening home prices in Houston is an indication that many home sellers are reconsidering what it's going to take to move their property.
"We are starting to see sellers come to terms with that," Trevino said. "Sellers do have unrealistic expectations still."
Another factor in the local home sales slump is one that many real estate experts could not have predicted. A few years ago, when mortgage rates hit record lows, homeowners locked themselves into deals that were hard to beat. Now, if they want to sell and move, they're finding those so-called "golden handcuffs" are making things considerably more difficult.
"You have sellers who don't want to move and they're staying in their homes longer because they got such an amazing interest rate and they don't want to have to purchase something at a higher interest rate," Trevino said.
That has led to an inventory problem over the past several years, which in turn has kept home prices higher than some experts expected. According to HAR's latest report, that inventory issue is getting better, with 2.7 months-worth of available housing last month, up considerably compared to one year ago.
Affordability is also becoming more of a concern in Houston as inflation and much higher interest rates have made the idea of home ownership unattainable for some potential buyers who could have easily afforded a home a year ago.
"Buyers now have to earn about 42% more income than they did at this same time last year in order to qualify for the rising prices and the interest rate that they have to bear when they purchase a home," Trevino said.
Local real estate experts say there are reasons to be optimistic in the short-term. Home sales were only down about 4.7% last month compared to the last non-pandemic April in 2019. And buyers have more leverage than they did a year ago, when homes had multiple offers and sellers were often able to get more than asking price for their homes. Now, buyers can negotiate more than they were during the red-hot pandemic market.
All of Houston's housing segments saw sales declines last month and the average time it took to sell a home in April was 55 days compared to 34 days a year ago.
Posted on · A sign sellers may have to accept the reality of a declining market is how long it takes to sell a home. Last month, that number was 62 days, nearly double the time it took to sell a home a year ago, at 38 days.
Posted on · High mortgage rates, inflation and fears of a recession this year have kept many potential homebuyers waiting for better market conditions.
Posted on · The average price of a home in Houston was $409,777 last month, up about 5% compared to December of 2021.
Posted on · A perfect storm of market conditions has led to a rough 2022 for home sales in Houston and across the nation.
Jack is back in Houston after some time away working in public radio and television in Lincoln, Nebraska. Before leaving for the Midwest, he worked in various roles at Houston Public Media from 2000-2016, including reporting, hosting and anchoring. Jack has also worked in commercial news radio in Houston, Austin...
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Houston's post-pandemic housing market hangover continued in April, with home sales down for the 13th consecutive month. In a new report released Wednesday, the Houston Association of Realtors said home prices dipped more than 18% last month compared to the same month in 2022.
"Interest rates are rising, taxes are rising, it's just a domino effect," HAR Chair Cathy Trevino said. "Insurance is rising, so all of these have an impact on your final payment and it is putting a crunch onto a lot of buyers."
The newest twist affecting Houston's housing market is falling prices. HAR says the median price of a home in Houston declined 3.6% last month, to $331,000, the second straight month of lower prices. The average price of a home dropped 1.6%, to $419,929. That's compared to more than $438,000 in May of last year, a record for Houston.
Other markets, like Austin and cities on both coasts, have seen far more dramatic price swings over the past few months. But any sign of softening home prices in Houston is an indication that many home sellers are reconsidering what it's going to take to move their property.
"We are starting to see sellers come to terms with that," Trevino said. "Sellers do have unrealistic expectations still."
Another factor in the local home sales slump is one that many real estate experts could not have predicted. A few years ago, when mortgage rates hit record lows, homeowners locked themselves into deals that were hard to beat. Now, if they want to sell and move, they're finding those so-called "golden handcuffs" are making things considerably more difficult.
"You have sellers who don't want to move and they're staying in their homes longer because they got such an amazing interest rate and they don't want to have to purchase something at a higher interest rate," Trevino said.
That has led to an inventory problem over the past several years, which in turn has kept home prices higher than some experts expected. According to HAR's latest report, that inventory issue is getting better, with 2.7 months-worth of available housing last month, up considerably compared to one year ago.
Affordability is also becoming more of a concern in Houston as inflation and much higher interest rates have made the idea of home ownership unattainable for some potential buyers who could have easily afforded a home a year ago.
"Buyers now have to earn about 42% more income than they did at this same time last year in order to qualify for the rising prices and the interest rate that they have to bear when they purchase a home," Trevino said.
Local real estate experts say there are reasons to be optimistic in the short-term. Home sales were only down about 4.7% last month compared to the last non-pandemic April in 2019. And buyers have more leverage than they did a year ago, when homes had multiple offers and sellers were often able to get more than asking price for their homes. Now, buyers can negotiate more than they were during the red-hot pandemic market.
All of Houston's housing segments saw sales declines last month and the average time it took to sell a home in April was 55 days compared to 34 days a year ago.
Posted on · A sign sellers may have to accept the reality of a declining market is how long it takes to sell a home. Last month, that number was 62 days, nearly double the time it took to sell a home a year ago, at 38 days.
Posted on · High mortgage rates, inflation and fears of a recession this year have kept many potential homebuyers waiting for better market conditions.
Posted on · The average price of a home in Houston was $409,777 last month, up about 5% compared to December of 2021.
Posted on · A perfect storm of market conditions has led to a rough 2022 for home sales in Houston and across the nation.
Jack is back in Houston after some time away working in public radio and television in Lincoln, Nebraska. Before leaving for the Midwest, he worked in various roles at Houston Public Media from 2000-2016, including reporting, hosting and anchoring. Jack has also worked in commercial news radio in Houston, Austin...
More Information
More Articles by This Author
Let the Houston Public Media newsroom help you start your day.
Get highlights, trending news, and behind-the-scenes insights from Houston Public Media delivered to your inbox each week.
Contact Us
4343 Elgin, Houston, TX 77204-0008
Houston Public Media is supported with your gifts to the Houston Public Media Foundation and is licensed to the University of Houston
Copyright © 2023
source
