Houston’s housing market shattered records in 2018, despite lingering effects from Hurricane Harvey and concerns that began late in the year over rising interest rates.
Single-family home sales were up nearly 4% over the previous record in 2017, the Houston Association of Realtors said Wednesday in an annual report.
Going into 2019, however, the health of the local market appears shaky as it faces a number of lingering headwinds as well as some unexpected new ones.
“Federal workers are on edge about the ongoing government shutdown and how that might hurt their cash flow, which could affect housing,” Shannon Cobb Evans, the association’s 2019 chair, said in the report.
In addition, the local market remains challenged by low inventory, rising mortgage rates and new tax laws that remove some of the benefits of homeownership.
Buyers last year closed on 82,177 homes, up 3.8% from the previous year, according to the realty association, which tracks home sales handled through the Multiple Listing Service across greater Houston. Total dollar volume for year spiked 21.5% to a record-breaking $28 billion.
But the market began to slow around the holidays.
In December, single-family home sales were down 4.1% to 6,543 transactions compared with the same month in 2017 — the second straight month of declining sales. Buyers closed on 6,543 sales transactions last month.
Only two segments of the market saw positive sales activity last month: homes in the $250,000 to $500,000 range and those in excess of $750,000. That helped bolster the median price for the month, which was 3.4% to $240,000.
The median sales price for all of 2018 was $237,500, up 3.3% from $229,900.
Townhome and condo sales also took a hit in December, falling 7.8% from a year earlier to 506 sales. Inventory inched up to 3.8 months.
Single-family inventory was up slightly from a 3.2-month supply a year ago to 3.5 months at the end of December. U.S. inventory currently stands at a 3.9-month supply.
Leasing activity, meanwhile, had a strong December. Single-family home leases climbed 13.2% and townhome/condo leases were up 1.6%. Average rents were flat at $1,771 for a single-family home and $1,532 for tonwhomes and condos.
Tribune Content Agency