Houston sales fizzled in August after months of growth, but price appreciation remained hot, the Houston Association of Realtors reported.
In terms of total single-family units, sales climbed by only 49 from the same time last year, an increase of less than 1 percent. When tiered by price, sales were solid for homes sold at $150,000 and above – below that mark, the market is suffering.
According to HAR, the distribution of sales were:
$1 – $79,999: decreased 8.9 percent
$80,000 – $149,999: decreased 20.1 percent
$150,000 – $249,999: increased 9.1 percent
$250,000 – $499,999: increased 5.3 percent
$500,000 and above: increased 1.8 percent
Despite the drop in sales, prices continue to rise in the Bayou City, the report found. The median price for single-family homes rose 4.9 percent year-over-year to $215,100; the highest August price ever for the city.
With sales falling flat, some would have expected price appreciation to correspondingly level out, but a low inventory is working to keep demand constant and high.
According to the report, Houston inventory has risen from a 3-months supply in Aug. 2014 to a 3.5-months supply in Aug. 2015. The rise is certainly welcome, but levels still remain well behind the nation’s 4.8 months of inventory.
Condo Sales Fall, Prices Up
For other sectors in Houston, the pattern of low sales and high prices is similar.
Sales of townhouses and condominiums in the city slipped 4 percent year-over-year. Median price, on the other hand, increased 4.7 percent to $149,000.
Inventory of townhouses and condos is also rising, but levels remain below that of even single-family homes. In August, inventory increased from a 2.6-months supply a year ago to 3.1 months.
Inventory Nearing Sustainable Levels
Prices in Houston keep rising. Continued strong appreciation into the fall and winter season, and even into 2016, could pose problems for long-term affordability. But HAR Chair Nancy Furst seems confident Houston will remain a strong market.
“The Houston housing market has been robust in 2015, keeping pace with last year’s record-breaking numbers and August turned out to be flat, by and large,” she said in the report. “We’ve started seeing signs of more sustainable inventory levels as more new listings come onto the market.”
If inventory reaches healthier levels, as Furst suggests, the result could be tempered price increases and more stable sales.