HOUSTON – (By Michelle Leigh Smith for Realty News Report) – The Houston single-family home market remained hot in August, with 9,890 single-family houses sold across the region. Strong demand and low inventory pushed August sales to one of the highest monthly totals on record.
Fourth-Best Month Ever for Houston Realtors
The Houston Association of Realtors reports that the August sales tally was the fourth-highest monthly total in Houston real estate history. Realtors say sellers were eager to list properties quickly to take advantage of the active market.
“We saw more sellers eager to list their homes immediately to take advantage of the market,” says Christy Bulerez of Keller Williams. “Sellers are becoming concerned that the market may decrease soon, and they are now hustling to beat a potential downturn.”
Houston home sales in August rose 8.5 percent compared with August 2020. Prices continued upward pressure: the median price for a single-family home in Houston was $310,000 in August, a 15.2 percent increase from $269,000 a year earlier.
“The confusing part of the market was we had a very strong spring,” says Ed Wolff, President of Beth Wolff Realtors. “That strength was driven by pent-up pandemic demand and low inventory, creating a brief frenzy for about three months. With inventories still low, that period made the market look like it was skyrocketing, but the surge was temporary. In July activity cooled. Looking at a six-month average, days on market average 40 to 50 days, which is consistent with a sellers’ market, but a sellers’ market is typically defined by six months of inventory. It will take time to reach that level. Sellers should not expect repeated multiple-offer situations unless pricing is within three to five percent of proven value.”
Price Gains Moderating?
Susan Brock, Broker/Owner at Brock & Foster, notes signs of moderation in pricing. “Some communities and price ranges are taking longer to sell, with fewer showings. One useful metric is the list price to sale price ratio: it shows whether buyers paid over asking or obtained a discount. In June and July 2021 that ratio exceeded 100 percent, but in August sales averaged 99.6 percent of asking price.”
She adds that the entry-level segment remains fiercely competitive, with buyers increasingly submitting creative and seller-focused offers to succeed.
Bulerez concurs that demand remains strong and continues to push prices up in many neighborhoods, although some areas are beginning to stabilize. “Real estate trends can vary by neighborhood and month. It is important to work with an experienced Realtor to understand what is happening in your area.”
In the $500,000–$750,000 range, prices rose 18.9 percent in July, according to the Houston Association of Realtors. For some agents, August was a banner month: Bulerez reported record activity in her business for the month.
Home Attracts 31 Offers in One Weekend
Jeremy Fain, Broker Associate with Greenwood King, sees prices stabilizing in central areas while suburban markets remain highly active. Multiple-offer scenarios persist in suburbs: “If a home is priced well and shows well, absolutely,” Fain says. “This is especially true in suburban markets. I listed a home last week and received 31 offers over the weekend.”
Bulerez notes the same pattern: homes that are remodeled, move-in ready, or especially affordable are the properties still drawing multiple offers because more buyers are shopping than there are homes available.
Will Home Prices Decline in Coming Months?
“I think they will level out, similar to 2014,” Fain predicts. “I expect more inventory to come on the market, making conditions a bit more competitive for sellers.”
Bulerez believes solid home values in Houston will remain for some time but expects variations across sectors and neighborhoods. “If prices do fall, I expect a gradual decline rather than a sudden drop,” she says.
Sellers’ Market Persists
With months of inventory remaining very low and homes selling quickly at rising prices, many Realtors call Houston a sellers’ market. “ABSOLUTELY!” Bulerez says. “It may slow or balance somewhat, but I anticipate it will remain a seller’s market for some time.”
Carol Knott Tefft of ReMax Integrity describes a brief slowdown around the start of school in August but says activity rebounded quickly, and she continues to see multiple offers across many listings.
“Houston is still a strong sellers’ market in many areas,” Brock says. “As of August 2021, inventory averaged 1.9 months—well below the six months that typically define a balanced market. Houston’s inventory level is lower than the national average (1.9 months versus 2.6 months). Buyers are still finding success, but it may take several attempts to win a bid.”
Fain emphasizes that market experiences vary by positioning: some sellers overprice homes and stay on market for extended periods, while those who prepare and price realistically within their niche often receive multiple offers and exceed list price. He expects the market to remain strong but become more balanced over time as buyers and sellers find more realistic footing.
Tefft, who works in northern Harris County, including Tomball, Spring, and Conroe, notes that low interest rates and the pandemic-driven reassessment of priorities—buyers seeking more space, pools, or different locations—have kept demand and sales high. “Inventory has been low for a while, and I don’t see it rising soon,” she says.
Across the region, optimism persists. Patrick Jankowski, Senior Vice President of Research at the Greater Houston Partnership, cites improving employment figures: the Texas Workforce Commission estimates about 240,000 Houstonians were unemployed and actively looking for work, down from 470,000 in April 2020. If job growth follows historic patterns, Houston could add 40,000 to 60,000 jobs for the remainder of 2021, which would support housing demand.
Sept. 8, 2021 Realty News Report Copyright 2021
Photo credit: Ralph Bivins, Realty News Report Copyright 2021
File: Houston Home Sales Hot In August