HOUSTON – (Realty News Report) – Houston home sales jumped to a record level in June as 9,328 single-family homes were sold, the Houston Association of Realtors reported.
This marked the first time monthly sales in Houston topped 9,000 transactions.
Buyers were drawn by exceptionally low mortgage rates. Freddie Mac reported the average 30-year mortgage rate at 3.03 percent for the week, the lowest level since Freddie Mac began its survey in 1971. A year earlier the 30-year rate was 3.75 percent.
The average 15-year mortgage rate also fell, reaching 2.51 percent, Freddie Mac said.
Despite the strong sales in June, parts of the residential market have struggled amid the economic fallout from the coronavirus pandemic. Significant job losses, pandemic-related layoffs, and business closures have weighed on Houston’s economy. Lower energy prices and reduced oil drilling activity have further constrained growth in recent months.
Those factors contributed to a steep 20 percent decline in home sales in May.
The June surge represented a notable rebound from the weak May performance.
HAR reported the 9,328 homes sold in June reflected a 15.7 percent increase over the 8,063 homes sold in June of last year.
“Coronavirus has driven the Houston housing market into uncharted territory; however, consumers have shown unwavering interest in real estate since the pandemic began,” said HAR Chairman John Nugent with RE/MAX Space Center. “HAR’s early rollout of virtual open houses and virtual showings has enabled buyers to continue house-hunting without compromising health and safety, and historically low interest rates have remained a strong incentive to buy.”
The June home sales surge helped the market regain ground lost earlier in the year. On a year-to-date basis, Houston home sales now match last year’s pace. The single-family home median price rose 3.6 percent to an all-time high of $262,000.
However, national forecasts from CoreLogic warn that elevated unemployment could push home prices lower, a risk heightened by recent increases in COVID-19 cases across the country.
“Pending sales and home-purchase loan applications are higher than in June of last year and reflect the buying activity of millennials,” said Frank Nothaft, chief economist at CoreLogic. “By the end of summer, buying will likely ease and we expect home prices to show declines in metro areas most severely affected by the recession.”
The average home sale price in Houston was $319,881 in June, a 3.2 percent decline from $321,884 in June 2019, the Realtors reported.
Inventory of homes for sale in Houston remains tight, at about a 3.2-month supply, and pending sales point to a strong July, HAR said.
July 9, 2020 Realty News Report Copyright 2020
Photo Caption: Houston home sales surge despite coronavirus concerns. Photo credit: Ralph Bivins of Realty News Report.