12/23/2016
HOUSTON HOME SALES SURGE IN NOVEMBER
Luxury market enjoys its first sales increase in over a year
Greater Houston Real Estate Market Update — The Houston housing market registered healthy gains in November thanks to more plentiful inventory, with single-family home sales surging nearly 23 percent compared to one year earlier when oil jitters sent sales tumbling. Sales among luxury homes (priced at $500,000 and above) —the segment most constrained by the ailing energy industry— leapt almost 33 percent. That represents the first increase that segment has seen since August 2015. For perspective, the increases place the market about 10 percent ahead of 2014 sales volumes.
According to the latest monthly report prepared by the Houston Association of Realtors (HAR), a total of 5,706 single-family homes sold in November compared to 4,651 a year earlier. On a year-to-date basis, home sales are up 2.7 percent compared to this point in 2015. Inventory levels grew slightly from a 3.4-month's supply to 3.6 months.
The single-family home median price (the figure at which half of the homes sold for more and half sold for less) rose 8.3 percent to $222,000 that marks the highest median price ever for a November. The average price increased 7.2 percent to $281,671, which also represents a November high.
November sales of all property types in Houston totaled 6,890, up 21.4 percent from the same month last year. Total dollar volume for properties sold in November shot up 28.7 percent to $1.8 billion.
Single-Family Homes Update
The Houston housing market saw across-the-board gains in November, with single-family home sales, total property sales, total dollar volume and pricing all up compared to November 2015.
Townhouse/Condominium Update
Townhome and condominium sales were also up in November, with 502 units selling in versus 438 a year earlier. That represents a 14.6 percent increase. The average price rose 12.6 percent to $208,388, while the median price surged 22.0 percent to $163,000. Inventory expanded from a 3.1-month's supply to 3.7 months.
Broken out by housing segment, November sales performed as follows:
• $1 - $79,999: decreased 19.8 percent
• $80,000 - $149,999: decreased 7.2 percent
• $150,000 - $249,999: increased 29.1 percent
• $250,000 - $499,999: increased 47.4 percent
• $500,000 and above: increased 32.5 percent
Contact me for a more detailed analysis of your specific market or neighborhood.
Mortgage Update
The last month has been a roller coaster for rates, with the majority of it being the uphill climb. We have had a few days of relative quiet since the election, such as last week. The referendum in Italy had little impact on our markets. We had a great week in the stock market with the first week of flat mortgage rates. However, yesterday had us on the upward climb again as the Fed's raised rates yesterday.
This increase in rate from the Federal Reserve board has been expected by most however, their hawkish statements along with their projections for accelerating the pace of increase in 2017 due "realized and expected labor-market conditions and a return to 2% inflation" had a negative impact on both the stock market and interest rates yesterday. This indicates that the Feds will reduce its holdings of Mortgage Backed Securities. This reduction is bad for rates. They also indicated that market-based measures of wage inflation has increased "considerably", another negative indicator for rates
We have indicators coming out all the time that can affect the rate but yesterday's meeting has had the most dramatic effect since the election. The industry has been predicting an increase in rates for some time so none of this is unexpected. I would anticipate a continuation of gradual increase at least through the first quarter of next year. While 5% is still a good rate those who have put off buying will definitely be disappointed that they have missed interest rates in the 3's and now maybe even the 4's.
