Home prices break records while sales volume reaches the highest level in four years
Houston home shoppers went on a buying spree in May, sending sales volume and pricing through the roof and accounting for the 12th consecutive month of positive sales. Average and median prices broke records while volume of sales reached the highest level since June 2008. Local housing inventory is now at its lowest level in more than five years.
May sales of single-family homes soared 23.8 percent versus one year earlier. That marks the biggest monthly increase since last August.
“Both buyers and sellers are reaping the benefits of an extremely healthy and robust real estate climate in Houston, driven largely by continued job gains that have been responsible for drawing many new consumers to this market,” said Wayne A. Stroman, HAR chairman and CEO of Stroman Realty. “Buyers are able to take advantage of the lowest interest rates in history as they shop for homes, and we’re also hearing accounts of sellers receiving the asking price for their homes, and in some cases getting even more.”
Strong sales activity among homes from $250,000 and up pushed average and median pricing to historic levels. The May single-family home average price rose 8.5 percent year-over-year to $237,083, the highest level ever in Houston. The median price—the figure at which half of the homes sold for more and half sold for less—rose 7.1 percent to $168,000, which is also a record high.
Foreclosure property sales reported in the Multiple Listing Service (MLS) increased 6.6 percent year-over-year in May. Foreclosures comprised 17.8 percent of all property sales, a share that has steadily declined each month since the 27.8 percent level recorded in January. The median price of May foreclosures rose 4.1 percent to $82,000.
May sales of all property types in Houston totaled 7,327, an increase of 24.2 percent compared to May 2011. Total dollar volume for properties sold during the month leapt 35.4 percent to $1.6 billion versus $1.2 billion a year earlier.
May Monthly Market Comparison
The month of May brought Houston’s overall housing market positive results when all sales categories are compared to May 2011. On a year-over-year basis, total property sales, total dollar volume and average and median pricing were all up.
Month-end pending sales for May totaled 4,476. That is up 10.5 percent from last year and is a strong indicator of another month of positive sales when the June real estate transactions are totaled. Active listings, or the number of available properties, at the end of May declined 18.1 percent from May 2011 to 42,280.
The May inventory of single-family homes reached its lowest level since March 2007. It has remained below a six-month supply since last December, coming in at 5.5 months in May versus 7.9 months a year earlier. The 5.5-month figure is better than the 6.6-month national inventory of single-family homes recently reported by the National Association of REALTORS® (NAR). This illustrates that Houston continues to outpace the national housing recovery.
Single-Family Homes Update
May sales of single-family homes in Houston totaled 6,185, up 23.8 percent from May 2011. This marks the 12th straight monthly increase and the largest jump since August 2011. The highest recorded month of single-family home sales volume dates back to June 2008 when it was 6,269.
Broken out by housing segment, May sales rose across the board, as follows:
- $1 – $79,999: increased 3.0 percent
- $80,000 – $149,999: increased 16.3 percent
- $150,000 – $249,999: increased 28.8 percent
- $250,000 – $499,999: increased 34.0 percent
- $500,000 – $1 million and above: increased 42.3 percent
At $237,083, the average price of single-family homes rose 8.5 percent from last May, resulting from a surge in sales activity among homes priced from $250,000 and above. The average price achieved a record high for the Houston market. At $168,000, the median sales price for single-family homes increased 7.1 percent year-over-year, also establishing a new highpoint.
HAR also breaks out the sales performance of existing single-family homes throughout the Houston market. In May 2012, existing home sales totaled 5,275, a 23.5 percent increase from May 2011. The average sales price rose 8.0 percent from last year to $224,154 and the median sales price increased 6.8 percent to $156,000.
Transactions among townhouses and condominiums showed tremendous strength in May, with the average price achieving a record high. In the greater Houston area, sales jumped 31.0 percent compared to one year earlier. A total of 571 units sold last month versus 436 properties in May 2011.
The average price climbed 14.6 percent to an all-time high of $186,472 in the May 2011- May 2012 comparison. The median price of a townhouse/condominium rose 12.3 percent to $141,500.
Lease Property Update
After tapering for the first time in more than a year in April, demand for lease properties was up once again in May. Single-family home rentals rose 15.5 percent compared to May 2011 and year-over-year townhouse/condominium rentals edged up 1.3 percent.
Houston Real Estate Milestones in May
- Volume of single-family home sales jumped 23.8 percent, marking the greatest monthly increase since August 2011 and accounting for the market’s 12th consecutive monthly increase;
- At $237,083, the single-family home average price reached an historic high for Houston;
- At $168,000, the single-family home median price also hit the highest level ever seen in Houston;
- Sales of townhouses/condominiums soared 31.0 percent and the average price achieved a record high of $186,472;
- Single-family home rentals rose 15.5 percent while rentals among townhouses/condominiums increased 1.3 percent;
- 5.5 months inventory of single-family homes remains at the lowest level in more than five years and compares favorably to the national average of 6.6 months.