Consumers continue to snap up homes despite tight inventory and record prices
Houston real estate held to record territory in June with buyers continuing to seize upon historically low interest rates as they purchased homes from among a limited supply. Despite the strong buying activity, the pace was slightly slower in the year-over-year comparison.
According to the latest Houston Association of REALTORS® (HAR) Market Update, single-family homes sales were up 13.6 percent compared to last June, with 10,638 units sold versus 9,362 a year earlier. That becomes the market’s thirteenth consecutive positive month of sales. On a year-to-date basis, home sales remain 25.9 percent ahead of 2020’s record pace.
Once again, homes priced from $750,000 and above dominated in sales volume with a 136.5 percent year-over-year increase. That was followed by the $500,000 to $750,000 segment, which soared 87.0 percent. The surge in high-dollar homebuying again pushed pricing to record-setting levels. The single-family home average price rose 23.7 percent to $395,316 and the median price increased 20.0 percent to $314,500.
Sales of all property types totaled 13,090 – the greatest volume of all time. That is up 16.9 percent from June 2020. Total dollar volume for the month climbed 43.8 percent to a record-setting $4.8 billion.
“The Houston housing market is in overdrive right now, and we know anecdotally that out-of-town investors have contributed to the frenzy,” said HAR Chairman Richard Miranda with Keller Williams Platinum. “We saw similar investment activity following Hurricane Harvey, and within a few months, the market stabilized. We expect stability to return this time around, so anyone in the market for a home who is frustrated by current market conditions needs to be patient.”
Lease Property Update
Consumer demand for lease properties waned in June as rent prices rose. Single-family lease homes fell 24.1 percent year-over-year while leases of townhomes and condominiums were unchanged. The average rent for single-family homes jumped 10.6 percent to a record $2,111 while the average rent for townhomes and condominiums increased 4.0 percent to $1,799, also a record.
June Monthly Market Comparison
Houston real estate achieved its thirteenth consecutive month of positive sales in June, with frenzied buying continuing to dominate the highest-priced segment of the housing market.
Overall June sales trends were positive. Single-family home sales, total property sales and total dollar volume all rose in comparison to June of 2020. Pending sales increased 3.1 percent. However, total active listings – or the total number of available properties – remain 31.3 percent lower than this time last year.
Single-family homes inventory reached a 1.5-months supply in June, down from 3.0 months a year earlier. However, that is the highest supply of homes in 2021 since February, with levels down to 1.4 months and 1.3 months in March and April, respectively. Housing inventory nationally stands at a 2.5-months supply, according to the National Association of REALTORS® (NAR).
Single-Family Homes Update
Single-family home sales rose 13.6 percent in June with 10,638 units sold across the greater Houston area compared to 9,362 a year earlier. Strong sales volume among homes at the high end of the market pushed pricing to levels that surpassed last month’s record-setting highs. The single-family home average price climbed 23.7 percent to $395,316 while the median price rose 20.0 percent to $314,500.
The time it took to sell a home fell by almost four weeks compared to June 2020. Days on Market (DOM) went from 57 to 29. Due to strong buyer demand and surging home sales, inventory registered a 1.5-months supply compared to 3.0 months a year earlier. That figure is the highest since February of this year and is below the current national inventory level of 2.5 months recently reported by NAR.
Broken out by housing segment, June sales performed as follows:
- $1 – $99,999: decreased 35.2 percent
- $100,000 – $149,999: decreased 40.7 percent
- $150,000 – $249,999: decreased 25.1 percent
- $250,000 – $499,999: increased 35.0percent
- $500,000 – $749,999: increased 87.0 percent
- $750,000 and above: increased 136.5 percent
HAR also breaks out sales figures for existing single-family homes. Existing home sales totaled 9,093 in June. That is up 24.3 percent from the same month last year. The average sales price rose 27.5 percent to $395,846 while the median sales price climbed 24.0 percent to $310,000 – both record prices.
Sales of townhouses and condominiums increased for the tenth straight month in June, jumping 49.9 percent with 898 closed sales versus 599 a year earlier. The average price rose 16.9 percent to $247,827 – the highest average price of all time — and the median price climbed 22.4 percent to a record-setting $214,125. Inventory fell from a 4.2-months supply to 2.5 months.
Houston Real Estate Highlights in June
- Single-family home sales increased for the thirteenth consecutive month, up 13.6 percent year-over-year with 10,638 units sold;
- The Days on Market (DOM) figure for single-family homes fell from 57 to 29;
- Total property sales rose 16.9 percent with 13,090 units sold – the highest volume in history;
- Total dollar volume increased 43.8 percent to $4.8 billion – a historic high;
- The single-family average price reached a new record high, increasing 23.7 percent to $395,316;
- The single-family median price rose 20.0 percent to $314,500 – also a record high;
- Single-family homes months of inventory registered a 1.5-months supply, down from 3.0 months year-over-year and below the national inventory of 2.5 months;
- On a year-to-date basis, single-family homes sales are running 25.9 percent ahead of 2020’s record pace.
- Townhome/condominium sales jumped 49.9 percent with the average price up 16.9 percent to $247,827 and the median price up 22.4 percent to $214,125 – both record-setting prices;
- Single-family home rentals fell 24.1 percent with the average rent up 10.6 percent to a record high $2,111;
- Townhome/condominium leases were flat with the average rent up 4.0 percent to a record high $1,799.