Home Sales Still Hot
What oil crash? Houston home sales continue to sizzle with record high prices
Houston home sales, even with oil-related economic downturn looming, recorded the strongest April ever with record-high prices and a record number of homes sold for an April, according to the Houston Association of Realtors.
“The slowdown is more psychological than real. The Houston economy is booming,” says Realtor Caroline Allison with Keller Williams Metropolitan. “If you look at the Houston real estate market, it is up on every measure as compared to last year.”
“The slowdown is more psychological than real. The Houston economy is booming,” says Realtor Caroline Allison with Keller Williams Metropolitan.
The association reports 6,502 single-family homes were sold in the Houston area in April. It was the highest sales total ever recorded for an April, typically a robust month as sales kick into gear for the spring buying season.
Many have been expecting an economic decline in Houston because oil prices have fallen from about $108 a barrel last summer to about $60 a barrel today and major energy companies have announced layoffs. But so far, home sales in Houston are keep pace with the sales of 2014, which was the best year ever for home sales in Houston, also known as the Energy Capital of the World.
“The Houston real estate market is doing quite well despite low inventory levels and concerns about the effects of declining oil prices,” says HAR Chair Nancy Furst with Berkshire Hathaway HomeServices Anderson Properties. “Realtors I speak to regularly tell me that business remains strong, and April’s uptick in inventory means consumers had the benefit of more homes hitting the market. We will have to watch and see how layoffs in the energy industry affect home sales in the months ahead.”
Local economists say it may take months before the slowdown in energy is felt in the local housing markets.
Home prices achieved record highs for an April, with the average price of a single-family home climbing 4.3 percent year-over-year to $281,724, HAR reports.
Townhome and condo sales in April were up over 6 percent in April, compared to April of 2014. The number of single-family homes sold in April was up 2 percent over last April.
Months of inventory, the estimated time it would take to deplete the current inventory of homes for sale, increased to a 2.9-months supply versus 2.6 months last April. The current national supply of homes for sale is 4.6 months of inventory.
Keller Williams’ Allison says the Houston’s bidding-war frenzy has cooled off somewhat, but home prices continue to go up and the inventory of for-sale houses is low.
“Buyers are experiencing fewer bidding wars, and real estate is continuing to grow at normal pace. Real estate is continuing to appreciate at a more normal pace; the frenzy from the oil bonanza days has tapered,” Allison says. “Once the oil prices come back, the frenzy and bidding wars will accelerate price increases.”
The number of “pending sales” is up sharply, indicating that May and June are likely to be strong also.
Ralph Bivins, founding editor of Realty News Report, is a past president of the National Association of Real Estate Editors.