Home sales hit a record high in June as 8,414 single-family homes were sold, the highest monthly sales total ever recorded in Houston, the Houston Association of Realtors reported.
“June proved to be another phenomenal month for the Houston real estate market with buyers and renters sending volume and pricing into record territory,” said HAR Chair Cindy Hamann. “Between continued strong employment numbers and healthy housing inventory levels, we expect the market to remain vibrant.”
The recording-setting 8,414 single-family homes sold in June represented an 8.3 percent increase over the 7,771 homes sold in June of last year.
June and May of this year are the only two months in which single-family sales have surpassed the 8,000-mark in the history of Houston real estate.
“It’s really a strong time to be selling,” said Amy Bernstein of Bernstein Realty. “Buyers want to make a move before there’s an increase in rates.”
In its new national survey, Freddie Mac reported the average 30-year, fixed-rate mortgage stood at 4.03 percent, up from 3.96 percent last week. A year ago, the average mortgage rate was 3.42 percent.
The Houston surge is showing no signs of slowing. The number of pending sales in the Houston MLS was up 19 percent in June over the number of pending deals counted at the end of June 2016.
The activity indicates that 2017 will likely be the strongest year on record for Houston home sales. Year-to-date sales are running 7.4 percent ahead of the 2016 sales pace, HAR reports.
Overall, the Houston residential market cruised through the crash in oil prices with little damage, except for some softness in the upper end. West Texas Intermediate crude peaked at $107 a barrel in June 2014 before taking a sharp decline that eventually bottomed out at $26 a barrel in February 2016. This resulted layoffs at energy firms in Houston and pain in the local economy.
Oil prices have recovered, with WTI hovering about $46 a barrel recently.
The stability in the energy markets has translated into more corporate relocation movement in Houston residential sales, said Mary Piper, director of relocations for Bernstein Realty. “I’ve seen a definite uptick in relo activity. I think there’s been a rebound in the oil industry,” Piper said.
Other industries and the medical sector have impacted residential relocations in Houston. Corporate mergers also have generated residential sales as employees were moved to Houston.
Another positive for the Houston residential market has been a rise in the inventory of homes for sale.
In June, new listings pushed inventory levels from a 3.9-months supply to 4.4 months, the highest in almost five years. A 6-months supply of homes for sale is considered a balanced market.
Houston’s inventory has been abnormally low in recent years, even dipping below a 3-months supply at times. The shortage of homes resulted in many would-be buyers losing out in bidding wars or seeing a house they liked get snapped up quickly before they could submit an offer.
The uptick in inventory has given buyers more choices and more sales are occurring in the more normalized market. Even with the rise in inventory, the Houston market remains a sellers market, well below the recession-impacted era when an 8-months inventory plagued the local realty.
The upper-end of the housing market showed strength in June. The upper-end home market, priced over $750,000 registered a 13 percent gain in sales activity.
The median home price – the midpoint where have the homes sold for more and half for less – rose 2.6 percent over June 2016 to an all-time record high of $239,023.
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