HAR has just released the results for October. Sales of Houston single family homes increased 13% compared to October 2008. This follows an increase of more than 32% in September. While Hurricane Ike affected the sales in these months, the nations economic problems found Houston in September as well. The months following October 2008 did not increase substantially. We should see double digit improvement for each of the next three months.
During the first five months the average number of single family homes sold in Houston is 3,925. The average number sold in the most recent five months is 5,155, a 31% increase.
I continue to see clear and convincing evidence that, while Houston is not soaring out of the market decline, we are experiencing solid, slow improvement.
The detailed statistics should be released tomorrow. I will post some detailed analyses of the data over the next few days.
HAR is expected to release the official October statistics next week. The number of homes sold will be very near 12% higher than October 2008.
The number of homes currently on the market through Houston's MLS is approximately 27,600 homes, the lowest for this time of year since November 2003. Historically, the number of homes on the market begins to decline in October or November. It will be interesting to see if inventory declines in December and January. With the number of pending sales remaining high, if inventory declines further and demand continues to increase slowly, we could see a strong Sellers' Market in the under $500,000 priced homes late in the first quarter of 2010. The offset to this may be that more home owners will gain confidence in the market and place their homes on the market.
I will watch the trends and report on this blog as they begin to unfold. Keep checking back.
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As the economy has begun to send signals of impending recovery, more and more signs of a recovery of Houston home sales are being seen. It has been more than two years since same month year to year comparisons have been positive. September single family sales were up 32% over September 2008. Of course September 2008 is when Hurricane Ike hit Houston. More important than the isolated September result, single family sales in the third quarter of 2009 increased 1.4% compared to the same period of 2008. Preliminary results indicate October will be at least 10% better than October 2008. Pending sales, a leading indicator of future sales in mid-October stood at more than 3,800, a level not seen since the first half of 2008 .
Within Loop 610, single family sales during Third Quarter 2009 were 766, a rate much higher than the Quarterly rate of sales during the First Half, and which is slightly ahead of Third Quarter 2008. Homes priced under $1 million did well. Sales of homes priced between $1 million and 2 million fell 11.9%. Sales of homes priced over $2 million fell 52.9%.
Overall the inventory of single family homes currently available for sale is lower than at any time since June 2003. Although demand is down, supply is also down and the result is inventory has remained in relative balance at approximately 6.2 months (more than 8 months is considered a Buyers' market). Upon examination of the inventory data, however, the low inventory relates to homes under $500,000. This reflects a reduction of inventory in the $350,000 to $500,000 price range since my last report covering the first six months of 2009.
West University, Southampton and Tanglewood turned in exceptional results for the third quarter. Even in these areas, new homes which are in the upper price ranges, are not selling well. Southgate has seen an increase in inventory and slowing of sales. This is out of the norm for what we have come to expect in Southgate over the past two years.
Impact on Buyers and Sellers
Buyers for homes under $500,000 may find there are fewer choices and that Sellers are less willing to negotiate far off their list price. As one moves up the price scale, the choices will become more numerous and competing buyers will become fewer. Over $2 million, the choices are many and the Buyers are few.
Sellers of homes priced under $1 million will continue to see steady traffic and interest if their homes are attractive and properly priced. While sellers should not be overly concerned, they must be cautious about pricing. This is not the time to put a high price on a home and hope someone will love the home and pay it. With a few exceptions, Sellers thinking about placing their home on the market at this time may want to wait until mid-January to avoid the Holiday slow down.
My advice to Buyers who have no home to sell: Buy Now. Interest rates are historically low. For homes under $500,000 buying competition is starting to heat up. For higher priced homes, the buying environment is good and Sellers should be willing to negotiate. With the improving market, especially in the close-in neighborhoods, the probability of a significant price decline is becoming low.
My advice to Buyers who have a current home to sell: If the home is very attractive, well located and priced under $500,000, it may be a good time to move. If the home is priced between $500,000 and $1 million, consult with me as some markets are better than others for this price range. For Sellers of homes priced over $1 million, wait to sell if you can.
The graph below shows a moving twelve month total for numbers of sales and pending sales of single family homes in the HAR MLS. It also shows the monthly numbers of active single family listings. Following the graph are detailed sales analyses of selected close-in neighborhoods and zip codes price range. If you would like further explanation of the market dynamics in a specific neighborhood, please contact me. I am always eager to provide you the information you need.
The information contained in this report indicates the type of analysis and detail I provide to Buyers and Sellers whom I represent. Contact me if you, or someone you know, are planning to buy or sell a home. I will demonstrate to you how my extensive business experience, proven real estate success and attention to client service will provide better results in your real estate transaction.
With me, Real Estate is all Business.
Based upon information from the Houston Association of Realtors® or its MLS for the period January 1,2000 to Present.
If you currently have an agency relationship with a licensed Real Estate Broker, this is not a solicitation to alter that relationship.
When the statistics are released by HAR mid-month expect to see that home sales in October were more than 10% better than October 2008. There should be improvement in all price ranges; however, the bulk of the increase will be for homes priced under $350,000.
I am putting the finishing touches on my Third Quarter report of close-in neighborhoods with statistics by neighborhood and by price range. Watch for it to be posted later today.
I use my proven real estate expertise, business experience, detailed analysis and attention to client service to benefit clients in their real estate transactions. With me Real Estate is All Business.
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