Lower inventories are starting to really have an impact on home prices in Houston. We are certainly in the midst of a boom of sorts that does not show any signs of abating. Here are the milestones we hit last month for the Houston area, as provided by the Houston Association of Realtors:
Single-family home sales increased 27.2 percent year-over-year, accounting for the market’s 23rd consecutive monthly increase and the largest one-month sales volume since August 2007;
Total property sales rose 28.8 percent compared to one year earlier and also accounted for the largest one-month sales volume since August 2007;
Total dollar volume surged 45.9 percent, increasing from $1.3 billion to $1.9 billion on a year-over-year basis;
At $184,900, the single-family home median price reached a historic high for Houston;
At $253,907, the single-family home average price also reached the all-time highest level;
3.4 months inventory of single-family homes is the lowest level since 1999 and compares to the national average of 4.7 months;
Sales of townhouses/condominiums shot up 31.0 percent year-over-year.
As we've seen in the most popular neighborhoods Inside the Loop (Houston Heights, Oak Forest, West University, Montrose, etc), home buyers are converging on new listings like bears to honey. Many homes are receiving multiple offers, which is helping to drive prices up. How long will this continue? That's anyone's guess. However, the flight back to the inner loop is only a 10 to 15 year phenomenon. A flight that has accelerated and should continue to accelerate as the schools and neighborhoods improve. As more people move into the city, the less property is available in the most desirous neighborhoods. Under those conditions and assuming good economic times in Houston continue, this boom in prices could have staying power. If you think differently, sound off. We want to hear from you.