Spring is in the air and the flowers are blooming in Houston again. Just as the weather is warming up, so is our housing inventory. I saw more homes come on the market in the Energy Corridor, Memorial and Katy last week than I have seen in months!
As inventory levels rise in Houston, this could be good news for our buyers who have been forced to compete in multiple offer bidding wars for homes priced under $1 million in these markets. One of our recent sales in the Energy Corridor landed the Seller more than $100k above the list price with a full appraisal waiver.
That’s right folks, we are still in a sellers’ market with pent up demand for homes under $1 million. Despite a topsy turvy ride with interest rates, the buyers seem to have come out of hibernation and are actively looking to buy homes. According to the article in the Greater Houston Partnership below, Single Family Home Sales were up over 9% in January compared to January of last year. “The period of rapidly escalating home prices may be over, however. The median price for a single-family home in January ’24 was up only 2.1 percent from January ’23 and 3.4 percent from January ’22,“ the article reported.
Don’t forget that Houston has multiple markets with a population of over 6.8 million in the metro area. Home prices in the Woodlands can be a totally different picture than what we are seeing in West Houston. With 8 companies postered to relocate their headquarters to the Energy Corridor this summer, we could see prices continue to go up in West Houston and Katy.
What is the prediction for interest rates? The economist had it wrong last year when they predicted that interest rates would drop to 5% by the last quarter of 2023, and instead they went up to 8%! 7% interest is more palatable this year for buyers that have been waiting, and when they dropped to 6.5% a the beginning of the year, it stimulated home sales again.
Both buyers and sellers seem to be ready this year as we have received more calls from sellers interested in listing their homes this first quarter as well. If all of these homes go on the market, we could see more balanced market for buyers by the end of the summer. Stay tuned for what happens in an election year!