HOUSTON – (By Michelle Leigh Smith for Realty News Report) – July marked the third-highest month for single-family home sales in Houston’s real estate history.
The Houston Association of Realtors reported 10,159 closed single-family home sales in July 2021, making it only the third month on record to top 10,000 sales.
“We are pleased to see the continued strength in the housing market through July,” says Paul Kilian, Senior Vice President at Sotheby’s International Realty. “Record-breaking numbers have been the theme lately, and low interest rates combined with strong buyer demand have been major drivers.”
The average 30-year fixed-rate mortgage stood at 2.87 percent, according to Freddie Mac’s weekly survey.
“July sales were very strong,” says Amanda Anhorn of Greenwood King Properties. “My July results were similar to previous months. Buyers who began searching in May had offers accepted in June. Most of my listings received multiple offers. I think suburban markets—Katy, Humble and The Woodlands—remain especially active. Showings in August have slowed somewhat; that could reflect buyer fatigue, vacations, or families preparing for the new school year. I don’t expect the frantic pace to continue indefinitely. We’re moving back toward a more normal market.”
Over 10,000 Homes Sold in July
Including single-family homes, townhomes, condos and lots, July saw 12,283 total property sales, a 3.7 percent decline from 12,865 sales in July 2020, the Houston Realtors organization reported.
Lisa Barnes, a listing broker with Coldwell Banker, describes her July as “fantastic.” “I’m seeing a bit of a slowdown in early August as people squeeze in final vacations before school starts. Today it was almost a surprise to have time to sit and catch up at the office. I’m still fairly busy, receiving rental inquiries and calls from people who were waiting to see if prices would drop. I’m also showing a property to an investor tomorrow.”
The median price of a single-family home sold in July was $309,910, up roughly 14 percent from July of last year, HAR reported.
Melinda Gordon of Bernstein Realty notes, “Every price point is seeing gains. If a home is priced realistically, it often receives multiple offers, which drives prices up.” A native Houstonian who grew up in Meyerland, Gordon hears the common question: will this sales surge continue?
“I get that question a lot,” she says. “No one has a crystal ball. Until more inventory becomes available, the upward pressure remains. At some point supply will catch up with demand, and the market will calm.”
Jean Shabot of Berkshire Hathaway HomeServices Premier Properties observes that the market is not as frenzied as it was in spring and early summer. “Inventory is slowly building, but the market remains very strong. There’s a severe shortage of affordable homes and rental units, which keeps the market stressed. Low interest rates have fueled this surge. July delivered record sales and there is still limited inventory. Investors continue to be very active. During the pandemic, 330,000 families moved to Texas from other parts of the country, and over the past decade, 1.1 million people moved into the Houston area.”
Houston’s supply of single-family homes fell to a 1.8-months inventory in July, down from 2.9 months a year earlier.
“I had two closings in July and three properties under contract,” says Sonia G. Ponce, an agent with Houston Center for Real Estate. “My sold properties closed at $475,000 and $250,000, both investment properties.”
The strong home sales are also affecting related industries such as home interiors.
“The home interiors business has seen increased sales during the COVID period,” says Tracey Shingledecker, co-owner of Back Row Home with Kelly O’Donnell.
Hardy Pollard, an agent with Nan & Co., reports his best month of the year in July. “I represented a buyer in a $1 million purchase at the start of July, which was great. I did notice the first two weeks of July slowed down considerably.”
These high sales figures come despite a 7.4 percent unemployment rate, up from 3.5 percent in February 2020. Houston lost 361,000 jobs at the pandemic’s outset and has recovered 213,500 of those positions.
Patrick Jankowski, Senior Vice President of Research with the Greater Houston Partnership, says that over the past year the region sold about 130,000 housing units—including condos, duplexes and single-family homes—and prices have risen by as much as $100,000 compared with this time last year. “That’s an extraordinary increase,” he says. “The core problem is a lack of inventory.”
“We have about half the supply we should have,” Jankowski adds. “Current measures show 10.5 months of supply compared to 19.6 months in January 2018. According to Zonda, there have been 12,174 new home starts—the best quarter since 2018.”
Future Shock
Jankowski warns that Houston’s long-term economic trajectory depends on how the region and energy sector adapt. “If the region continues business as usual without an energy transition, the economy could contract. Estimates from McKinsey & Company suggest Houston could lose another 270,000 jobs over the next 30 years. That number could rise to 370,000 if the world accelerates toward a low-carbon future, and to as many as 650,000 if dramatic global steps limit warming to 1.5 degrees Celsius.”
Aug 12, 2021 Realty News Report Copyright 2021
Photo: By Ralph Bivins, Realty News Report Copyright 2021
For more about Texas real estate, check out the book Houston 2020: America’s Boom Town – An Extreme Close Up by Ralph Bivins. Available in print and ebook formats.
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File: Over 10000 Homes Sold in Houston