Local Katy Texas Market Report for Year 2011
The Houston Real Estate Market is an extremely large geographic area and very complex market with numerous sub markets all performing pretty much independently. Generalizations about market conditions for the Houston Metropolis make little sense and really have no meaning. Houston has 46 separate and distinct MLS areas. Katy Texas is just one part of these numerous sub-markets. I believe the Katy market is comprised of 3 unique market areas each having different characteristics. The first market area is the town of Katy itself (old Katy) which can be isolated for the most part from the other areas as homes in this area are subject to the rules of the City of Katy. Second is MLS Area 36 which is probably almost all properties that are actually physically located in a Katy mailing address and covers a large geographical area South of I-10. MLS 36 is zoned for the Katy ISD system. Third area is also a huge geographical area North of I-10 being MLS Area 25. This area includes a large segment of Cypress Texas as part of this MLS area. As in prior reports I have written during 2011, my market report will only cover MLS Area 36 or South Katy where there are numerous neighborhoods and a huge number of homes. This is my personal main area of operation.
There is a new classification method of areas in Houston and now one can get data for MLS area 36 broken into two distinct sub areas. These areas are defined by West of Highway 99 and East of highway 99. I have not attempted to write a market report about Cinco ranch as it is comprised of so many separate neighborhoods scattered all over the area. The West of 99 methods to search the MLS may present an opportunity to write about all Cinco Ranch neighborhoods West of Highway 99.
As I have for several months, I have examined the Prudential Gary Greene Realtors (PGG) index they refer to as the “Hotness Index”. I was formerly an agent with PGG in Katy Texas and I still refer on a regular basis to the PGG market data they provide to the public via their web site as it is excellent data and very well done. The “Hotness Index” is a means of measuring demand and really only means anything if it compared to other sub- markets in the Houston Metropolis. During the month of December 2011, South Katy was dropped to eighth after having risen to the number 1 spot during November. South Katy has usually ranked in the top five during spots during the last 4 – 5 years. I really do not have an explanation for dropping to eighth but I believe South Katy will jump back into the one of the top five spots in January 2012.
For the month of December 2011 there were 173 pending sales, 244 actual sales and there were 999 active listings with an inventory of available homes of 4.1 months.
These market numbers being reported are all for the year 2011 and are coming from data supplied by the Houston Association of Realtors. Unit sales are up by 9.09 % from year 2010 or by 244 homes and Median prices have decreased to $240,170 or 2.0 % decrease from 2010. Average prices have decreased by .27 % to $271,532. This continues to be excellent news for the Real Estate Market in Katy as well as Houston. Prices have remained fairly constant while trending slightly downward at the end of the year and can be considered stabilized. The pricing trend line has been for the last 4-5 years shown a small 3-5 % increase and I believe there is reason to believe it will continue during 2012 and probably beyond
The percentage of discount sellers are willing to take from list price has remained constant at 4 % during most of 2011. Months of available inventory has decreased to 4.1 months from 4.2 during year 2011. Pending sales have increased by approximately 11.22 % which I believe continues to be a pre-cursor for continuance of positive trends and hopefully through the winter and spring months of 2012.
Recent clients I have assisted have all at one time or another asked questions about the statistics that I have shown and discussed above. My previous statement includes first time home buyers. The language home buyers use maybe a little different but the questions are about market data pretty much as I have shown. I had a rather detailed discussion of the market numbers over this last weekend with an existing client and also with a new first time home buyer client. Buyers are savvy and want the data.
The chart below shows the makeup of available homes in South Katy by price. 62.0 % of the available homes are priced under $300,000. There are several excellent homes available right now at fairly cheap prices. Please do not count on either prices falling during 2012 or a huge of foreclosures coming on the market.
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HOMES AVAILABLE IN SOUTH KATY
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17-Jan-12
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DOLLAR
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NUMBER
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NUMBER
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% OF
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CHANGE
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PRICE POINTS
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OF HOMES
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< 300,000
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Total
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LAST MONH
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<100,000
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36
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12
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100,000-150,000
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78
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7
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150,000 - 200,000
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170
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16
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200,000 - 250,000
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163
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14
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250,000 - 300,000
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133
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580
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62.0%
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(4)
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45.00
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300,000 - 350,000
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97
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10.4%
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8
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350,000 - 400,000
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83
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8.9%
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(11)
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> 400,000
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176
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18.8%
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(19)
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TOTAL
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936
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23
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I had inquiry this past fall from a potential client I have worked with for a fairly long time. They decided to rent a home at first after moving from the East Coast to the Katy area. They want a large home with 5 or more bedrooms, 4 or more baths, 4,500 sq. ft. minimum with a big yard and they have a price budget which makes this possible. However, they continue to read the newspapers on the East Coast and think they will find a bargain short sale or foreclosure matching their criteria here in Katy as they want their children to attend KISD. Unfortunately, the odds of me finding one of these bargain priced large homes is maybe very small at best and shrinking as the days go by. If you are waiting for the deal of a lifetime you and your family will probably never find it at least here in Katy and all the excellent reasonably priced homes will eventually be sold. Timing is everything for most us during our lifetimes. Don't miss the current opportunity to buy a home.
As of January 24, 2012 there are only 32 Foreclosure homes and 23 Short Sale homes available for sale. That is not a very large inventory of distressed homes. There are two fairly good sized homes of over 4,000 sq. ft. that are foreclosures and they are priced at $499,000 and $775,000 which equates to $112 sq. ft. and $149 per sq. ft. respectively. While these maybe excellent prices for either of these two homes these are not what I consider bargain purchases. Twenty four homes considered foreclosures are priced at less than $200,000 with median asking price being $162,400.
Excellent home are available for sale in Katy continue to be available at very good prices. This situation poses itself to a potential buyer to be an excellent opportunity to acquire a home in Katy. Homes for rent in Katy are extremely tight as that trend has continued all during the year 2011 with only maybe a little over one month’s supply of available homes. This situation has existed for a long time and will probably continue into 2012. The rental markets that are close by geographically to Katy being Sugar Land and Cypress are continuing to experience the same robust rental market conditions and it has lasted all year as well. I have had numerous potential clients tell me that will wait and rent a home in Katy or Sugar Land or Cypress. This situation has continued through the entire year. This is a difficult task to accomplish especially if you and your family are working with a limited budget. As soon as a good rental home hits the market at a decent rental price per month it is gone. The time to buy is right now while interest rates are still extremely low and there is a good supply of available homes. The supply of homes priced less than $300,000 will continue to dwindle each month I believe during 2012. I have said this numerous times in the last nine months or so that all of these tremendous opportunities will not be around forever. Katy has everything a family needs to live and act now before it is too late and the gravy train of buying a good home at reasonable price no longer exists.
If you or your family would like to search for homes in Katy or another area near Katy or search the Houston MLS go to my profile on Houston Assocation of Realtors.
