Houston’s inventory woes continue to boost prices, but they are starting to impact home sales in the Bayou City.
With record-low inventory in Houston pushing down home sales in January, homebuyers ended up paying more for the homes that were available, according to a recent article from the Houston Association of Realtors.
January single-family home sales totaled 3,957, which is the lowest one-month sales volume since February 2012. According to the monthly report prepared by the HAR, home sales edged up 1.7 percent year-over-year, the smallest one-month sales increase since June 2011.
32 Straight Months for Positive Sales
Despite the low inventory affecting the buyers market, January has marked the 32nd consecutive month that sales have remained in positive territory. December’s 2.6 month’s of inventory matched last month’s, compared to a 3.6-month supply in January 2013.
Shrinking inventory and heavy sales activity among homes priced between $200,000 and $600,000 has significantly pushed pricing up in Houston in the year-over-year comparison. A single-family home’s median price has jumped 18 percent to $177,000. Average price has gone up 22 percent year-over-year to $244,000. Both figures represent the highest prices for January in Houston, according to the report.
Higher-priced home sales are experiencing growth because of the decline in sub-$80,000 and $80,000-$150,000 markets record declines.
Charlie Ralph – “Supply and Demand Playing Out”
Charlie Ralph, the current chairman of HAR, said that Houston’s housing market is currently constrained by market forces.
“January is traditionally a slow time of year for home sales, but throw a depleted supply of inventory into the mix and you get exactly what the Houston market experienced last month,” Ralph said. “Until more housing inventory hits the market, we are likely to continue seeing lower sales volume and higher pricing than we did throughout 2013. It’s the basic economic principle of supply and demand playing out.”
When comparing to sales in January 2013, Houston’s real estate market in January 2014 saw gains in all measurements. Total property sales, total dollar volume and average and median pricing all rose on a year-over-year basis.
Low inventory has affected the active listings in Houston, with the number of available properties having dropped from 15.9 percent to 28,211. Rentals of single-family homes had an increase of 23.6 percent, while rentals of townhouse and condominium units rose 13.3 percent.