Houston Real Estate Update: December 2015 – Home Sales Dip For Two Consecutive Months

Houston Real Estate Update: December 2015 – Home Sales Dip For Two Consecutive Months

Average price sees its first decline in nearly four years.

HOUSTON HOME SALES FALL FOR A SECOND STRAIGHT MONTH IN NOVEMBER

The following is the most recent Houston MLS Report, published by the Houston Association of Realtors. The data covers Houston homes for sale and real estate trends from the last twelve months (November 2014 – November 2015).

November Houston Real Estate Milestones:

  • Single-family home sales fell 10.5 percent compared to November 2014, marking the second consecutive monthly decline and sixth month of negative sales volume for all of 2015;
  • Total property sales dropped 10.1 percent (5,623 units);
  • Total dollar volume decreased 13.5 percent to $1.4 billion;
  • At $262,064, the single-family home average price saw its first decline since February 2012;
  • At $200,000, the single-family home median price achieved a November high;
  • Single-family homes months of inventory climbed to a 3.4-months supply versus 2.7 months a year earlier;
  • Townhomes/condominium sales dropped 10.3 percent with the average price down 9.3 percent to $183,884 and the median price down 15.2 percent to $130,000;
  • Leases of single-family homes rose 7.5 percent with rents up 1.9 percent to at $1,707;
  • Leases of townhomes/condominiums jumped 8.1 percent with rents flat $1,527.

 

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Houston Real Estate Updates In November

The onset of the holiday shopping season and continued strains within the energy industry weighed on Houston’s housing market in November. Home sales fell for the second consecutive month and dragged average price down with them, marking the first price decline since February 2012.

According to the latest monthly report prepared by the Houston Association of Realtors (HAR), November single-family home sales slid 10.5 percent with a total of 4,595 sales compared to 5,135 a year earlier.

Only homes in the $150,000 to $250,000 price segment experienced positive sales volume. That, coupled with a 22 percent drop in luxury home sales, accounted for the decline in average price. Among homes that did sell in November, Days on Market (DOM), or the number of days it took the average home to sell, edged up to 55 days versus 54 in 2014.

 

houston neighborhood map

Slower sales allowed for a slight improvement in months of inventory, the estimated time it would take to empty out current active housing inventory based on sales over the previous 12 months. It grew from a 2.7-months supply last November to a 3.4-months supply. Inventory has held at about a 3.5-months supply for the past five months and remains below the current national housing supply of 4.8 months of inventory.

While the average price of a single-family home fell 3.5-percent year-over-year to $262,064, the median price—the figure at which half the homes sold for more and half for less— reached the highest level ever for a November, rising 2.2 percent to $200,000.

Sales of all property types totaled 5,623 units, down 10.1 percent compared to last November. Total dollar volume fell 13.5 percent to $1.4 billion.

“The Houston housing market saw further correction in November and will likely exit the year with exactly the declines that were forecast coming off record-setting sales in 2014 and an environment of limited inventory and plunging oil prices,” said HAR Chair Nancy Furst with Berkshire Hathaway HomeServices Anderson Properties.

November Monthly Market Comparison

The Houston housing market saw declines in most measurements in the November 2015 versus 2014 analysis, with single-family home sales, total property sales and total dollar volume all down along with single-family home average price, while median price of a single-family home climbed to a record high for a November.

Month-end pending sales for single-family homes totaled 5,617, a 6.3 percent drop from a year earlier, which is an indication that sales will likely remain in negative territory when the December numbers are tallied. Active listings, or the number of available properties, at the end of November rose 21.5 percent to 33,272.

Houston’s housing inventory has held at about a 3.5-months supply since July of this year, up from the 2.7-months supply recorded in November 2014. That level still remains below the current 4.8-months national supply of homes reported by the National Association of Realtors (NAR).

CATEGORIESNOVEMBER 2014NOVEMBER 2015CHANGE
Total property sales6,2555,623-10.1%
Total dollar volume$1,621,016,494$1,401,611,221-13.5%
Total active listings27,37433,27221.5%
Single-family home sales5,1354,595-10.5%
Single-family average sales price$271,487$262,064-3.5%
Single-family median sales price$195,750$200,0002.2%
Single-family months inventory*2.73.428.7%
Single-family pending sales**5,9935,617-6.3%

* Months inventory estimates the number of months it will take to deplete current active inventory based on the prior 12 months sales activity. This figure is representative of the single-family homes market.

** Effective May 2015, in an effort to be consistent with industry standards, the Houston MLS is now including all categories of pending sales in its reporting. Previously, the Houston MLS did not include “option pending” and “pending continue to show” listings in its reporting of pending sales. The new methodology is now all-inclusive for listings that went under contract during the month.

Single-Family Homes Update

Single-family home sales totaled 4,595 in November, down 10.5 percent from November 2014. That marks the second straight monthly decline, although there have been a total of six months of negative sales for all of 2015.

The average price fell for the first time since February 2012, declining 3.5 percent to $262,064. However, the median price achieved the highest level ever for a November in Houston, rising 2.2 percent year-over-year to $200,000. The average number of days it took to sell a home, or DOM, was 55 in November versus 54 days a year earlier.

For perspective, single-family home sales tracked on a year-to-date basis were down 1.8 percent at 67,771.

Broken out by housing segment, November sales performed as follows:

  • $1 – $79,999: decreased 28.6 percent
  • $80,000 – $149,999: decreased 21.0 percent
  • $150,000 – $249,999: increased 5.7 percent
  • $250,000 – $499,999: decreased 9.1 percent
  • $500,000 and above: decreased 22.0 percent

HAR also breaks out the sales figures for existing single-family homes. Existing home sales totaled 3,927 in November, down 7.6 percent versus the same month last year. The average sales price fell 3.8 percent year-over-year to $241,718 while the median sales price climbed 3.5 percent to $186,000.

Townhouse/Condominium Update

Sales of townhouses and condominiums tumbled 10.3 percent in November. A total of 425 units sold compared to 474 properties in November 2014. The average price dropped 9.3 percent to $183,884 and the median price fell 15.2 percent to $130,000. Inventory grew from a 2.4-months supply to 3.2 months.

Lease Property Update

Demand for single-family lease homes rose 7.5 percent in November while townhomes/condominiums saw demand jump 8.1 percent. The average rent for single-family homes edged up 1.9 percent to $1,707 while the average rent for townhomes/condominiums was unchanged at $1,527.

The computerized Multiple Listing Service of the Houston Association of REALTORS® includes residential properties and new homes listed by 25,000 REALTORS® throughout Harris, Fort Bend and Montgomery counties, as well as parts of Brazoria, Galveston, Waller and Wharton counties. Residential home sales statistics as well as listing information for more than 50,000 properties may be found on the Internet at http://www.har.com.

The information published and disseminated to the HAR Multiple Listing Services is communicated verbatim, without change by Multiple Listing Services, as filed by MLS participants.

The MLS does not verify the information provided and disclaims any responsibility for its accuracy. All data is preliminary and subject to change. Monthly sales figures reported since November 1998 includes a statistical estimation to account for late entries. Twelve-month totals may vary from actual end-of-year figures. (Single-family detached homes were broken out separately in monthly figures beginning February 1988.)

Founded in 1918, the Houston Association of REALTORS® (HAR) is a 26,000-member organization of real estate professionals engaged in every aspect of the industry, including residential and commercial sales and leasing, appraisal, property management and counseling. It is the largest individual dues-paying membership trade association in Houston as well as the second largest local association/board of REALTORS® in the United States.

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