The Texas housing market has cooled slightly, with home sales down 3.5% in the third quarter compared to last fall’s extraordinary market. The total number of homes sold dipped to 115,272.
“Although we’re seeing a slight decline in homes sold from the same period a year ago, it’s important to remember we’re comparing to 2020’s record-breaking numbers,” said Texas REALTORS® Chairman Marvin Jolly. “Across the state, we’re still experiencing strong demand for housing, and buyers are moving to Texas from all over the nation.”
Texas REALTORS® has released the 2021-Q3 Texas Quarterly Housing Report. The median sales price of a Texas home leapt 16.9% to $310,000 since last fall. Approximately 30% of homes were priced between $200,000 and $299,999.
The housing frenzy due to the pandemic has possibly peaked, says Luis Torres, research economist with the Texas Real Estate Research Center at Texas A&M University. “Home prices and homes sales are beginning to slow. In addition, months of inventory and home listings have reached a trough and are now increasing. Still, for the remainder of 2021, the housing market will be characterized by strong demand with low inventories accompanied by strong price growth, albeit at a slower rate.”
Housing inventory fell to 1.6 months in the third quarter, down 2.3 months from the third quarter of 2020. The research center cites 6 to 6.5 months as a balanced market.
Read the report at 3588612.com.
The market problem I see is that the inventory for affordable housing, especially for first time buyers is too low. When an acceptable property is listed, the seller gets multiple offers, and the poor buyer is fighting for a chance. Since no counter offers are coming, buyers never know if they are bidding against themselves when they are in competition for a home. Going well over list also means the buyer needs a large down payment to help them when the property does not appraise at sales price. Many of these prospects simply give up and renew a lease. Also,… Read more »
Real estate is local but inventory, especially in affordable price ranges, is still extremely low and the difference in 1.6 months and 2.3 months just means there are only 12 over list price offers instead of 25. It is going to take some time for this supply / demand imbalance to play out.