Friday, October 12, 2018 / by Michael O'Neal
After a sizzling summer of home sales and rentals, the Houston housing market cooled in September, showing no apparent lingering effects of Hurricane Harvey as it did in August.
According to the latest monthly report from the Houston Association of REALTORS® (HAR), 6,548 single-family homes sold in September compared to 6,953 a year earlier. That represents a 5.8-percent decline. On a year-to-date basis, however, home sales are running 5.6 percent ahead of 2017’s record volume.
The single-family home median price (the figure at which half of the homes sold for more and half for less) eked out a fractional 0.2 percent increase to $232,500, and the average price edged up 1.2 percent to $295,765. Both represent the highest prices ever for a September. All housing segments experienced declines except those homes priced at $750,000 and above – considered the luxury market – which rose 2.7 percent.
September sales of all property types totaled 7,842, a 4.4-percent decrease over the same month last year. Total dollar volume was down 3.5 percent at $2.2 billion.
“With tight inventory, rising interest rates and families focused on back-to-school, it wasn’t a huge surprise to see market activity slow down at this time,” said HAR Chair Kenya Burrell-VanWormer with JPMorgan Chase. “The Houston economy is strong. As we head into the fall months, it will definitely take a healthy supply of homes and some pricing moderation to keep prospective buyers engaged in the market.”
The employment landscape across Houston remains robust and has served as a solid driver for real estate throughout 2018. In the October 2018 edition of The Economy at a Glance, the Greater Houston Partnership (GHP) reported that metro Houston created 110,200 jobs in the 12 months ending August 2018. That is a 3.7 percent increase and the strongest 12-month pace in more than three years.
Lease Property Update
Activity among lease properties was down sharply in September. Single-family home rentals fell 35.4 percent while leases of townhomes and condominiums dropped 44.5 percent. With the decline in volume came a decline in rents. The average rent for single-family homes slid 4.0 percent to $1,812 while the average rent for townhomes and condominiums dipped 1.0 percent to $1,584.
September Monthly Market Comparison
Measurements of the Houston real estate market’s September trends were mixed, with single-family home sales, total property sales and total dollar volume all down compared to September 2017, and pricing up slightly. Month-end pending sales for single-family homes totaled 6,630, a 9.0 percent increase over last year. Total active listings, or the total number of available properties, climbed 5.7 percent to 41,560.