HOUSTON – (Realty News Report) – Where is Houston’s housing market headed in 2020? Job growth is expected to moderate. Mortgage rates are forecast to remain below 4 percent, yet the National Association of Realtors continues to urge increased homebuilding to meet strong demand and address tight inventory. The market is still being reshaped by the lingering effects of Hurricane Harvey, which can leave a stigma on homes and neighborhoods with a history of flooding. Despite that, Houston Realtors posted record home sales in November and pending sales rose sharply. 2019 is on track to be the strongest year ever for Houston home sales. The question is whether that momentum can continue into 2020. Realty News Report asked leaders of three Houston residential firms for their perspectives: Bill Baldwin of Boulevard Realty; Amy Bernstein of Bernstein Realty; and John A. Daugherty, Jr. of John Daugherty Realtors.
Realty News Report: What are you expecting for the Houston real estate market in 2020?
Daugherty: There is an air of optimism heading into 2020. Cranes dot the skyline and older structures are being replaced with larger developments. Inventory will continue to be tight in some neighborhoods while other areas will have ample supply. Overall, I expect a market with mixed pockets—some constrained, some plentiful—reflecting Houston’s varied neighborhoods and price points.
Bernstein: With an election year ahead, predicting 2020 is more challenging, yet I remain optimistic about Houston’s economy and the real estate opportunities across the region. As we enter a new decade, I’m excited about the prospects for the city and its housing market.
Baldwin: From a market perspective, most indicators point to continued positive headlines unless a significant economic disruption intervenes. Fundamentals look favorable for continued stability and growth.
Realty News Report: The upper end of the market appears softer. The Houston Association of Realtors reported a 9 percent drop in sales for the $750,000-and-up segment in November. What’s happening in the luxury market?
Bernstein: In mid-2019 the luxury segment showed signs of softening and inventory appeared to rise. Real estate cycles include ups and downs, and I’ve seen these oscillations throughout my career. Often when the market softens, it can rebound quickly, so a temporary dip does not necessarily indicate a long-term trend.
Baldwin: Houston benefits from a resilient, broadly positive market, but real estate is local. Some neighborhoods or sectors will underperform others due to price adjustments, flood impacts, or other local factors. That local variation explains softness in certain luxury pockets even as the overall market remains healthy.
Realty News Report: Job growth has been strong but may ease in 2020. How is corporate relocation affecting the residential market?
Bernstein: Relocation activity has stayed steady, with companies from varied industries expanding into Houston and its suburbs. Many relocated employees rent initially to learn the city, while others move quickly to buy. Current market conditions offer solid opportunities for both renters and buyers coming into the region.
Realty News Report: The brokerage business is undergoing disruption: iBuyers, venture-backed brokerages, and national firms are active in Houston. Your thoughts?
Baldwin: Disruption accelerated in 2019 and will continue. The rise of iBuyers and venture-backed brokerages can confuse consumers trying to understand how these options affect their largest asset or purchase. Ultimately, it’s important to rely on licensed Realtors—skilled, trained professionals who prioritize clients’ best interests—even as business models evolve.
Daugherty: Houston will always have a robust real estate market. Sellers should engage well-educated real estate professionals who can provide realistic pricing guidance. That knowledge helps sellers position their properties to be competitive and active in the market, rather than simply listed and overlooked.
RECAP — Houston Association of Realtors’ November report: Houston recorded 6,395 single-family home sales in November, a 3.6 percent increase from the previous November, according to the Houston Association of Realtors. It was the strongest November on record for Houston home sales.
Single-family home prices in Houston reached new November highs. The median price—the midpoint at which half the homes sold for more and half sold for less—rose 2.5 percent to $240,900.
Dec. 18, 2019 Realty News Report Copyright 2019
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