Houston’s Best & Worst Housing Markets
Houston's Best & Worst Housing Markets
Read this if you’re looking to buy or sell a home in Houston this year.
Background
The average Houston single-family home sales price is up 3.6%. Total sales volume of all property types is also up 18%(1).
However, this outlook can be misleading. You don’t buy an average Houston house.
Buyers and sellers need to look at trends in their targeted segments versus just relying on the overall stats.
The oil price crash and COVID-19 are also currently affecting the market.
Summary
Aside from 6 leading indicators we watch for how the market is trending, we also mapped out the sales trends of 12 different housing segments.
Broken down by property type and price point, we looked at the 10-year sales data of EACH segment to gain insight on how that specific section of the market will trend.
Houston real estate is hyper local. For buyers and sellers, it’s very important to understand which segments and pricepoints are in a buyers and sellers market.
Takeaway
This data set should serve as a guide to your negotiating style & pricing strategy.
If you use the wrong negotiating or pricing module, it can cost you significant time, money and heartache.
This data is presented by property type & price range for “close in Houston.” (Other formats: Top Schools, Best Appreciation, Best Suburbs, or Request your own format.)
Since Houston real estate is hyper-local, understanding the gradations in your particular niche is critical.
If you're looking to buy or sell a home in Houston and need advice about the market, please contact Paige Martin at [email protected] Paige Martin is ranked as the #1 Keller Williams Realtor in Houston and #5 Keller Williams Realtor in the United States.
Table of Contents
- Houston Real Estate: The Good, The Bad, & The Ugly
- Absorption Rates And What It Means For You
- Houston Housing Market: 10-Year Appreciation Rates
- Houston Housing Market: 5-Year Appreciation Rates
- Houston Housing Market: 1-Year Appreciation Rates
- Sources, Methodology & Disclosures
- Top Ranked Realtors: Paige Martin & The Houston Properties Team
Houston Real Estate: The Good, The Bad, & The Ugly
“Paige Martin is the best Houston Realtor. She is highly experienced and very knowledgeable. Paige and The Houston Properties Team made our buying experience an enjoyable one, not only for us, but for our daughter, son-in-law and several of our friends. We have bought and sold many houses, and Paige has been the best realtor we have ever worked with. We highly recommend her.” – Jeremy & Lynn Greene
The average single-family home sales price is up 3.6% across the board. TOTAL property sales volume is also up by 18%(1).
However, this outlook can be a bit misleading for buyers & sellers:
- You don’t buy an average house.
- The total Houston stats don’t reflect the trends in your specific target segment.
- The COVID 19 lockdown affected the rate of transactions (ie more sales were recorded in the immediate months following the lockdown).
- Typically there’s a 6- to 12-month lag on how the market reacts to economic dips or spikes.
For example, when you divide the Close-In Houston real estate market(2) into 12 segments based on property type & price range, the data indicates:
- Only 4 of the 12 segments appreciated in the last year.
- More than half of the market is still down from when oil prices peaked 6 years ago.
- 33% of the market is in a “strong buyer’s market.”
- Sellers currently have the upper hand in about 40% of the market.
Now is a good time to be a buyer of:
- $1M+ Highrise / Midrise Condos
- $1M+ Townhomes
- $500K – $1M Highrise / Midrise Condos
- $1M+ Single Family Homes
Now is a good time to be a seller of:
- $100K – $250K Single Family Homes
- $250K – $500K Townhomes
- $100K – $250K Townhomes
- $250K – $500K Single Family Homes
- $500K – $1M Single Family Homes
Over the past 10 years, the best appreciation rates have come from:
- Land value
- Homes zoned to top ranked schools
- Homes close to major job centers
Absorption Rates And What It Means For You
Many of Houston’s most popular neighborhoods are also, historically, the best performers in real estate appreciation. Contact us for a custom list of homes in these areas.
The absorption rate shows how many months it will take to sell out the current supply of homes available (excluding any new listings) based upon the current rate of sales.
As a sample, if there are 10 homes for sale on your block, and 1 home sells every month, then there are 10 months of inventory (e.g. it should take 10 months to sell all of the homes on your block.)
5 – 7 months is a “balanced market.”
A smaller number is better for sellers. A larger number is better for buyers.
Right now, in Houston, it’s a good time to be a buyer of:
- $1M+ Highrise / Midrise Condos
- $1M+ Townhomes
- $500K – $1M Highrise / Midrise Condos
- $1M+ Single Family Homes
Right now, in Houston, it’s a good time to be a seller of:
- $100K – $250K Single Family Homes
- $250K – $500K Townhomes
- $100K – $250K Townhomes
- $250K – $500K Single Family Homes
- $500K – $1M Single Family Homes
Houston Housing Market: 10-Year Appreciation Rates
“Paige is simply amazing! Paige is a customer service driven agent that doesn’t let any small details slip past her. She is meticulous with her offers, inspections, and knows how to effectively negotiate the right price for her buyers and sellers” – William Swallen
Over the past decade, nearly all types of Houston real estate have performed well.
Condos between $100K-$250K are top performers. This can be attributed to the rapid growth in the Inner Loop areas, and due to more people looking to move to flood-proof homes.
Luxury townhomes over $1,000,000 are starting to pick up, along with other luxury properties. This may be partly due to the median price dipping slightly, and the fact that many of these luxury townhomes are within neighborhoods that did not floood during Harvey.
Despite this, this housing segment is still lagging behind performance-wise, due partly to certain developers over-pricing new construction listings a decade ago, and the fact that when comparing Houston townhomes for sale vs Houston single family homes for sale appreciation of land values typically exceeds appreciation for any given structure.
Single family homes under $250,000, however, have been seeing a decline.
Read more about Houston Best Real Estate Investment Themes.
Houston Housing Market: 5-Year Appreciation Rates
Whether you buy or sell first depends on the current market and your unique situation. Both options come with an element of risk. Our experience taught us to make the proper assessment out of the overall scenario every homeowner is in. Contact us to help you make the most viable decision.
Over the past five years, lower priced properties in close proximity to major job centers (e.g. Downtown, Medical Center or Galleria) have appreciated very well.
In addition, here are some of the key success themes for the three property types that appreciated the most over the past 5 years:
- School zoning;
- Close proximity to a major job centers (Downtown, Galleria or Medical Center).
- The Medical Center area has also been in continual high demand.
- Two bedrooms are often easier to resell or rent out, as it can be rented to people with a roommate.
- Access to public transportation (METRORail or good bus lines).
- Try and avoid being right on a railroad or freeway.
- Having a good floor plan matters.
Houston Housing Market: 1-Year Appreciation Rates
Buying or selling a home within the best neighborhoods in Houston can be very tricky. With over $500M real estate sales, the Houston Properties Team is the #1 Boutique Real Estate Team in Houston. Contact us for a custom Houston cost of living calculator, and we can review your options.
The 2020 Houston housing market is seeing an unprecedented shift due to the recent oil price crash and the economic impact of COVID-19. Coming off a record year, we entered 2020 in a seller’s market. Now we’re seeing a lot of volatility across the board and we expect things to keep moving right before the end of the year.
When comparing 2019 results to YTD 2020 data, the trends are very notable, including:
- The luxury condo market is seeing a slight drop. Several new construction mid-rise condo projects are impacting the market. More units mean higher competition. Many of these buildings are also selling units below its developers’ expectations, contributing more to the decline.
- Condos at some of the older buildings have struggled, making it increasingly important to buy a condo in one of Houston’s premier condo buildings. (For a detailed report on which buildings are performing better, contact us.)
- Townhomes and single-family homes over $1M are performing well.
- Single-family homes and townhomes in the $250K-500K range showed little movement.
Please contact me if you’re interested in seeing how your home, neighborhood or area of interest has performed over the last decade.
Sources, Methodology & Disclosures
With all the available information out there about Houston's top areas, it can be confusing when finally making a decision on which neighborhood to choose. Get the advice of the best Houston Realtors and remove the guesswork when looking for one of the best homes in Houston to live in.
- (1) According to the most recent Houston real estate HAR report at https://www.har.com/content/newsroom/ as of the time of this writing.
- (2) Statistical trend data for the Close-In Houston real estate market listed above is defined by the HAR MLS Areas 2,4,9,16,17,22,23,24 (originally created by KeyMap), unless otherwise noted.
- Appreciation rates based on Median Sold Price Per Square Foot.
- Sales volume data for 2020 is annualized data.
- All Houston property sale information was sourced by the HAR MLS database.
- Data is deemed accurate, but is not guaranteed. Information is provided for informational purposes only.
- If you’d like to see any neighborhoods, master-planned communities or subdivisions added to this bi-annually updated watch list, please let me know.
Top Ranked Realtors: Paige Martin & The Houston Properties Team
The Houston Properties Team has a well-defined structure based on the individual strengths of each member. Each member is a specialist in their role – which is why our homes sell faster and for more money than average.
Paige Martin, Broker Associate with Keller Williams Realty, and the Houston Properties Team are ranked amongst the top residential Realtors in the world.
They have been featured on TV and in dozens of publications including: The Wall Street Journal, Fortune Magazine, Reuters, Fox News in the Morning, Money Magazine, Houston Business Journal, Houstonia, and Houston Chronicle.
Paige Martin was just ranked as the #5 agent in the world with Keller Williams, and has completed over $500,000,000 in Houston residential real estate sales.
Recent awards include:
- 2020: Top Real Estate Team (Houston Properties Team), Houston Business Journal
- 2020: #6 Individual Agent, Keller Williams, Worldwide
- 2020: #1 Individual Agent, Keller Williams, Texas (Top Keller Williams Realtor)
- 2020: #1 Real Estate Team, Keller Williams Memorial
- 2019: Top Residential Realtors in Houston, Houston Business Journal
- 2019: America’s Best Real Estate Agents, RealTrends.com
- 2019: #5 Individual Agent, KW Worldwide
- 2019: #1 Individual Agent, KW Texas
- 2018: #5 Individual Agent, Keller Williams, Worldwide
- 2018: #1 Individual Agent, Keller Williams, Texas
- 2018: #1 Individual Agent, Keller Williams, Houston
- 2018: America’s Best Real Estate Agents, RealTrends.com
- 2018: Top 25 Residential Realtor in Houston, Houston Business Journal
- 2018: Texas’ Most Influential Realtors
- 2017: #1 Individual Agent, Keller Williams, Texas
- 2017: #1 Individual Agent, Keller Williams, Houston
- 2017: #10 Individual Agent, Keller Williams, Worldwide
- 2017: America’s Best Real Estate Agents, RealTrends.com
- 2017: Top 25 Residential Realtor in Houston, Houston Business Journal
- 2017: Texas’ Most Influential Realtors
- 2016: #1 Individual Agent, Keller Williams, Texas
- 2016: #1 Individual Agent, Keller Williams, Houston
- 2016: #20 Individual Agent, Keller Williams, Worldwide
- 2016: Texas’ Most Influential Realtors
- 2016: Top 25 Residential Realtor in Houston, HBJ
- 2016: Five Star Realtor, Featured in Texas Monthly
- 2016: America’s Best Real Estate Agents, RealTrends.com
- 2015: #9 Individual Agent, Keller Williams, United States
- 2015: #1 Individual Agent, Keller Williams, Texas
- 2015: #1 Individual Agent, Keller Williams, Houston
- 2015: America’s Best Real Estate Agents, RealTrends.com
- 2015: Top 25 Residential Realtor in Houston, HBJ
- 2015: Five Star Realtor, Texas Monthly Magazine
- 2014: America’s Best Real Estate Agents, RealTrends.com
- 2014: #1 Individual Agent, Keller Williams Memorial
. . . in addition to over 318 additional awards.
Paige also serves a variety of non-profits, civic and community boards and was appointed by Houston’s Mayor to be on the downtown TIRZ board.
Benefits Of Working With The Houston Properties Team
Our Team, composed of distinguished and competent Houston luxury realtors, has a well-defined structure based on the individual strengths of each member.
We find team approach as the most effective way to sell homes. We have dedicated people doing staging, marketing, social media, open houses and showings. Each Houston Properties Team member is a specialist in their role – which is why our homes sell faster and for more money than average.
The benefits of working with a team include:
- ability to be in two or three places at one time: a member can handle showings, while another answer calls
- collective time and experience of members
- targeted advise and marketing of agent expert in your area
- competitive advantage by simply having more resources, ideas, and more perspectives
- a “Checks and Balances” system. Selling and buying a home in Houston is an intensely complex process
- more people addressing field calls and questions from buyers and agents to facilitate a faster successful sale
- efficient multi-tasking: One agent takes care of inspections and/or repair work, while another agent is focused on administrative details
- multiple marketing channels using members’ networks
- constant attention: guaranteed focus on your home and your transaction
- lower risk for mistakes. Multiple moving parts increase oversights. A team approach handles these “parts” separately
- flexibility in negotiation and marketing
- better management of document flow
- increased foot traffic through more timely and effective showing schedule coordination; and
- increased Sphere of Influence and exposure to more potential buyers.
To meet all the award-winning members of The Houston Properties Team, please go here.
