Houston’s median home price hit its highest point ever in March, as the city’s strong economy and low mortgage rates fueled the market.
At $172,000, the last month’s single-family home median price reached an historic high for Houston, the Houston Association of Realtors said. The March median price, which is the midpoint where half the homes sold for more and half for less, was up 6.5 percent from March of last year.
By comparison, today’s median price of $172,000, is almost three times the median home price of $65,000 in 1980.
There are indications that the supply problem may be easing as a larger number of homes have come on the market in April.
Houston’s inventory of homes for sale — a 3.5-month supply — is the lowest since 1999. With demand high and supply low, home prices have nowhere to go but up in 2013.
In many neighborhoods, homes are getting multiple offers the same day the for-sale sign goes into the front lawn.
A total of 5,779 single-family homes were sold in March, the Houston Realtors group said, a 17 percent increase over March of last year. It extended a 22-month streak of gains in home sales for the super-hot Houston home market.
“It’s the best we’ve seen in 30 years in this marketplace,” said Cheri Fama, president of John Daugherty Realtors of Houston.
Custom home builders snap up tear-down lots in the Inner Loop, Memorial and Tanglewood areas as fast as they become available. Home builders paid more than $1 million for a number of prime lots in Tanglewood recently, Fama said.
“Custom builders are back. They are building with a vengeance,” Fama said. Many builders are constructing “spec” homes, meaning they are starting construction without having a buyer lined up — and often these spec homes are priced at more than $1 million.
Home prices have been going up at a steady and healthy pace, without rapid upward price spikes that are difficult for the market to support, Fama said.
The Houston housing market is being elevated by significant job growth. Houston added 118,700 new jobs in the last year, the best job growth in the nation, according to the U.S. Bureau of Labor Statistics.
“Realtors continue to see multiple offers on single-family homes and condos throughout the Houston market, which suggests that our local economy is growing stronger by the day,” said Houston Association of Realtors chairman Danny Frank of Prudential Anderson Properties.
Buyers also have been motivated by exceptionally low mortgage rates of less than 4 percent, lower than they have been in decades.
Houston’s tight supply of homes for sale has made the home-buying process difficult for buyers in certain areas because houses have been selling so quickly or sales prices get driven up in bidding wars. Buyers have to move quickly to get the house they want. Fama said there are indications that the supply problem may be easing as a larger number of homes have come on the market in April.
Sales of townhouses and condominiums rose sharply in March — up 47 percent from one year earlier. A total of 550 units sold last month versus 374 properties in March of last year.
Houston has one of the strongest housing markets in the nation and the surge is expected to continue for a while.