Mortgage rates remain at or near all-time lows and homebuyers continue to take advantage. As predicted, the Fall has started out as one of the strongest fall markets in Houston in recent memory and this should last into the holiday weeks to come.
According to the Houston Association of Realtors, single-family home sales across greater Houston totaled 9,287 in October compared to 7,187 a year ago, a 29.2 percent jump. The luxury home market continues to lead the way. Sales for homes priced at $750,000 and up surged 81.6 percent compared to October 2019. Homes priced between $500,000 to $750,000 jumped 78.4 percent year-over-year. This is quite a turnaround from the early months of the Covid pandemic.
The single-family home median price rose 11.1 percent to $266,685 while the average price increased 12.4 percent to $334,996. Both figures are record highs for October.
According to HAR, total active listings, or the total number of available properties, dropped 25.9 percent from October of last year. Total Sales on the other hand increased 31.5% to 11,232 from October 2019. As a result, the absorption rate for October 2020 was 36% compared to 17% in October of 2019. This Brawny level of absorption will no doubt continue to limit the number of available homes as we approach the holidays.
Higher absorption levels have also impacted the speed of home sales. Days on Market (DOM), or the number of days it took the average home to sell, lowered from 59 to 47. Due to a slowdown in new listings, single-family home inventory continues to fall, with 2.4 months supply in October versus 2.5-months in the previous month. For perspective, housing inventory across the U.S. stands at a 2.7 months supply, according to the most recent report from the National Association of Realtors (NAR). Houston’s inventory level is the lowest level we have seen since December of 2014.
**Months inventory estimates the number of months it will take to deplete current active inventory based on the prior 12 months sales activity. This figure is representative of the single-family homes market.
As long as inventory levels remain low and mortgage rates remain near current levels, we are more than likely going to see quick sales at higher prices. If you are looking to buy or sell a home, let us know. Every market and situation is different and we are happy to help you evaluate your options to determine if now is the right time for you.
