Housing deteriorates

Houston-area market sees a decline in home prices and sales

By NANCY SARNOFF
Copyright 2008 Houston Chronicle

The Houston area's housing market continued to weaken in January as sales fell to their lowest level in three years and home prices dipped.

Experts linked the slowdown to a tightening in subprime lending, combined with consumer jitters about a possible recession, an uncertain presidential election and a national real estate crisis.

Some would-be home buyers are "taking a bit of a wait-and-see approach," said Mike Gray of Exit Complete Realty. "They think they may get a better deal or that rates are going to go lower."

Single-family home sales in the Houston area fell 12 percent last month compared with a year earlier, the Houston Association of Realtors reported Tuesday. Realtors sold 3,620 homes through the Multiple Listing Service.

While the decline wasn't as severe as December's 16.5 percent drop, home prices slid to their lowest level since January 2006.

The median price for a single-family home was $139,000, falling 2.8 percent. The last time there was a monthly decrease in prices was in August 2004.

In some areas, new-home construction is putting downward price pressure on older homes.

Alfredo Bonfante's real estate agent has suggested he drop the $210,000 asking price on his four-bedroom, 2,100-square-foot home in The Woodlands.

In four months, Bonfante hasn't gotten any offers. He thinks it's because new homes nearby are selling for as little as $5,000 more than what he's asking.

"They're giving all stainless-steel appliances, and instead of carpet they're giving tile," said Bonfante, whose house is only about two years old.

The association blames the decline on a seasonally slow time of year, as well as a national credit crisis, which has removed a big chunk of buyers from the market.

"We always say the real estate market is local, but the mortgage industry is national," said Michael Levitin, the association's chairman and principal of HTownRealty.com.

Houston-area home buyers, however, stand to benefit from low interest rates, affordable pricing and a good selection of inventory, he said.

Erich Braun is one of those buyers.

He and his wife are buying a five-bedroom, 3 1/2 bath house near Texas 6 and Bissonnet for nearly the same price for which he's listing his two-bedroom townhouse just outside the Galleria area.

Vira Garza, an agent with Prudential Gary Greene, Realtors, is telling some of her clients that now's not the best time to put their homes on the market.

Garza works in northeast Houston, where builders are offering discounts on new homes, making it harder to sell older properties.

"For a few thousand dollars more, you can get a new house," she said. "I'm telling people to wait a few months because their house is going to be sitting there."

Indeed, homes here are staying on the market longer.

It took an average of 92 days to sell a house in January, the longest period since February 2004 and well in excess of the 81 days recorded in January of last year, the association reported.

Since the market began to falter last year, the entry-level sector has taken the hardest hit. Homes priced between $80,000 and $150,000, which made up 39.3 percent of local sales, fell almost 20 percent in January.

Homes in that range relied heavily on buyers with poor credit who were able to get loans during the recent boom.

High-demand areas
Still, there are hot spots, particularly in the inner city where prices have risen and properties have remained in high demand.

Barbara Walker put her three-bedroom, 1,790-square-foot house in Timbergrove Manor on the market about a week ago for $299,900 and has had a showing almost daily.

"Houston hasn't been in the hole that the rest of the U.S. has been in," said Walker, who's downsizing to a townhouse.

Home sales above $500,000 rose 30.3 percent in January, though they only made up 4.4 percent of the market.

Mark Dotzour, chief economist at the Real Estate Center at Texas A&M University, said fewer consumers are buying partly because of the nation's uncertain political environment.

Depending on who's elected president, there could be major changes in the nation's tax code and energy policy.

"Some politicians are talking about how they want to punish the oil industry," Dotzour said. "I have a feeling that people in the oil industry are listening to that and wondering what life is going to be like."

6-month inventory
Historically, prices don't fall in Texas until housing inventory levels reach nine or 10 months, he explained.

The association said it would take six months to sell the number of homes that were on the market at the end of January, based on the last 12 months of sales activity.

Houston should weather the downturn better than other parts of the country because of low mortgage rates, strong job growth and steady home price appreciation, Dotzour said.

But based on the number of pending sales at the end of January, the slowdown is likely to continue. Those listings expected to close within 30 days reached 4,269, an 11.3 percent decline from last year.

The slowdown has led agent Garza to start looking for another job. Since she got into the business about a year ago, she's spent far more on training and advertising than she's made selling homes.

"I have agent friends going through the same thing," she said. "They're all like, 'Gosh, what did I do?' "

Home sales retreat, but year still strong

Last year was second-best on record despite first drop in over a decade

By NANCY SARNOFF
Copyright 2008 Houston Chronicle

Houston-area home sales fell 4 percent last year, the first annual drop in more than a decade.

But 2007 still marked the second-best year on record. Sales peaked in 2006.

In light of the nation's sputtering housing market, "I think we're real lucky in Houston," said Michael Levitin, this year's chairman of the Houston Association of Realtors and principal of HTownRealty.com.

Houston, he said, has an advantage over other parts of the country because of its strong job market that's been largely fueled by the energy industry.

Home prices also went up last year, albeit slightly.

The median sales price of a single-family home was $152,000, or an increase of 1.6 percent compared to 2006, the association said. The median is the price at which half the homes sold for more and half for less.

That's 30 percent less than the national median price of $217,600, according to the National Association of Realtors, which expects a 12.5 percent decline in 2007 home sales.

Houston real estate broker Shad Bogany of ERA Bogany Properties said the local market has some areas that are lagging, "but the bottom line is it's the best year ever," not counting 2006.

Still, there are indications of possible clouds ahead in the Houston area. Sales of single-family homes fell 18.3 percent last month, the fourth consecutive monthly drop and the biggest decline of the year.

And the number of listings expected to close within the next 30 days was down about 14 percent at the end of December, signaling a slower January.

Moreover, foreclosures could rise if homeowners can't keep up with payments from adjustable-rate mortgages that are expected to reset to higher rates this year, which could depress prices in some areas.

But low interest rates and more lenders willing to work out problems with borrowers in trouble could soften the blow.

The main reason for last year's decline was a sharp drop in sales of homes priced between $80,000 and $150,000, which made up nearly 39 percent of the 69,441 properties sold through the Multiple Listing Service, which include mostly used but some new homes.

That portion of the market has slowed because fewer people have been able to qualify for loans ever since subprime lending dried up last year.

"If you're making $2,000 a month and have a $300 or $400 car note, you can't qualify to buy anything," Bogany said.

Edmund Choi plans to put his Missouri City home on the market later this month before relocating with his family to New Jersey.

"I'm a little nervous," said Choi, who bought the four-bedroom home new more than 12 years ago for $140,000. "I have a feeling I'm not going to get what I want to get."

But overall, home prices here haven't fallen because they never shot up like they did in other markets where it costs more to build because of strict regulations or land shortages.

"Houston is a lateral city, and it's easier for a lateral city to continue to grow than a city that's stacked on top of each other," said Martha Turner of Martha Turner Properties. "With no zoning, it allows us to be a more stable environment."

Turner, whose company sells many of Houston's higher-end homes, said the market's upper end is being supported by well-paying energy jobs, as well as a growing Medical Center and port industries.

Throughout 2007, sales of homes $500,000 and more were up more than 9 percent.

Jen Goodspeed sold her West University house last year for $879,000 after finding a buyer in just 12 days.

She bought the 3,800-square-foot, four-bedroom house with a pool and room over the garage three years earlier for $850,000. When Goodspeed put her 6-year-old home on the market in July, she said, homes in her neighborhood were selling quickly.

"The housing market in Houston was, at that time, pretty strong. But it looked like nationally the housing market was going to be going down," she said. "I wanted to sell it before we got to the state we're in right now."

October Houston Real Estate Wholesale Market Revitalized

11/26/2007 8:20:00 AM
By HoustonRealNews Market Analyst

The market may be improving for Houston Real Estate. Deals have increased, in both listings and sales, from the past month's weak numbers.

That according to an analysis of Houston Real Estate wholesale listing site MyHouseDeals.com.

Out of 157 listings in October, 37 houses have been sold while 120 are still up for sale. That's 35 more properties listed on the market and 11 more houses sold from September's 26 homes sold out 122 listed.

Average asking prices of homes sold have increased as well. Average asking price for the month is $65,500, $11,000.00 more than September's average.

The wholesale numbers may indicate that the recent slowdown in the market may be bottoming, which the recent HAR data appears to support.

The wholesale market serves as a reasonably steady indicator of market activity.

The wholesale market serves as a reasonably steady indicator of market activity.

Housing, Job Opportunities Favor Texas

By Blanche Evans

NAR expects the national median price of homes to drop to $218,200 in 2007. In Dallas, where it's warm, wide-open, and there are lots of jobs, the median home price is going up. One of the few bright spots of the retreating housing market, Dallas is beating national numbers in jobs, culture, and inflation in terms of housing appreciation. And with a median-priced home only two-thirds the price of the national median at $156,000, the city is a screaming, stomping bargain.

There's just one little problem. Dallas is moving into a financial press-led housing recession, too. Why blame the financial press? Because buyers aren't paying attention to the positives. Fear has them sitting on the sidelines just when they could score the housing touchdown of their lives.

Dallas sat out the housing boom of 2001-2006. In fact, Dallas homes appreciated below the national median for over 16 years, until this year. Recovering from the oil embargo of the 70s, the Savings and Loan crisis of the 80s and technology meltdown of the aughts, Dallas never got up off its knees. Exacerbating the problem was a squabbling, racist city council and school system. People with means high-tailed it for the suburbs, and Dallas deteriorated.

But the smell of money is in the air. Forbes magazine recently ranked Dallas-Fort Worth among the Best Cities to Live as number one in cost of living; number five for job growth, number nine both in the best cities for singles and in the culture categories.

Other Texas cities fared well, too. Austin came in at number 12 on the Best Cities list, and Houston wasn't far behind at number 14. Houston (Harris County) added 79,400 jobs between September 2005 and 2006, the nation's largest increase in employment among the nation's 325 largest counties, according to the U.S. Census.

Opportunity has attracted among the youngest and most educated workforce in the southwest in hubs like Dallas, Austin, and Houston, but Texas is a close second to Florida in luring older workers and retirees, according to a report by Thomas, Warren + Associates for the National Active Retirement Association in Charlotte, N.C.

In 2005, Texas gained 27,000 new residents over the age of 65, bringing a total of $732 million in added income to the state. While that's less than half of Florida's gain at 68,000 new older population and $1.9 billion, what's significant is a large number of workers and retirees are not "following a job" to the state, but choosing to live there on Texas' merits.

One reason Texas is attracting young and old is the outlook for jobs. A Harris Interactive monthly survey in July found that more Texas workers are feeling confident about the job market and the future of their current employer. About 47 percent felt that the economy is coming along nicely, and a whopping 82 percent felt they were unlikely to lose their jobs.

Yet housing is struggling in Dallas. According to the North Texas Real Estate Information System which collects data from 18 MLS partners across 29 counties, the Dallas-Fort Worth hub sold 10 percent fewer homes (8,480) in August than last year. Homes are staying on the market three percent longer at 69 days than last August.

Yet median prices -- up four percent to $156,000 compared to $150,000 last year in Dallas-Fort Worth -- are bucking the trend, despite rising foreclosures in Fort Worth and mid-cities Arlington, up five percent for the first half of 2007, says RealtyTrac. Elsewhere in Texas, foreclosure filings were down more than 13 percent from mid-year 2006.

"The decline in filings and properties with filings reflects the continued steady increase in Texas residential property values, the continued stable economy and employment and the fact that Texas did not rely on extreme, exotic loan terms to the same extent as other, higher-priced markets," said Dr. Jim Gaines, research economist with the Real Estate Center at Texas A&M University in a newsletter.

Gaines says a great deal of the national foreclosure market is concentrated in a handful of states, primarily the previously hot markets in California, Florida, Nevada and Arizona, as well as Michigan, Ohio and Indiana, where the pullback in the automotive industry has resulted in job losses.

Texas is looking more and more like the land of opportunity.

Regional Spotlight: Houston Housing Market Weathers Mortgage Turbulence

RISMEDIA, August 16, 2007—With widespread reports of mortgage companies across the country filing for bankruptcy, shutting down operations or having difficulty finding the money to fund loans, the greater Houston real estate market held up remarkably well in July.

Sales actually rebounded from the previous two months of declining sales. While the inventory growth of available homes for sale slowed from its recent torrid pace, prices were mixed. The only price segment that continues to show signs of moderate weakness is the $80,000 to $150,000 range, which is clearly the result of the mortgage and lending issues.

Total property sales for the month registered 8,114, which was a 1.1% increase versus July 2006. Properties sold during the month reached a total of nearly $1.7 billion, a 5.3% increase compared to last year’s nearly $1.6 billion in July sales. Additionally, the median home price for a single-family home reached $155,100 for July, and the average single-family home price came in at $209,339, a decline of 0.5% and an increase of 1.8%, respectively.

“Everyone has heard the saying that real estate is local, but unfortunately, the mortgage industry in national. While the Houston housing market has held up much better than the rest of the nation, the mortgage finance problems that have been widely reported have resulted in some volatility in our market in the lower price ranges. In these more uncertain times in the housing market, it is even more important to make sure to seek the counsel of a real estate professional,” said Rob Cook, HAR Chairman and broker/owner of Robert D. Cook Properties. “The good news for Houston is that energy prices remain strong, job growth continues and the local economy shows resilience. If any market in the country can withstand the impact of the lending woes it will be this region.”

July Monthly Market Comparison

All listing categories combined, Houston’s overall housing market in July saw mixed results, with increases in total property sales, total dollar volume, and average sales price on a year-over-year basis. A decline was seen in the median sales price.

The number of available homes (active listings) at the end of July was 52,976 properties, which was an increase of 16.1% versus last July and the 13th month with a year-over-year increase, after 10 consecutive previous declines. The figure was an increase of only 200 properties from last month, which shows that the summer selling season is likely slowing, as is typical as the school year approaches. It is still a figure to watch to see if inventory of available homes rises faster than sales, which could eventually place downward pressure on prices as well, especially with the rash of foreclosures in this market.

Month-end pending sales – those listings expected to close within the next 30 days – reached 5,520, which was up 8.1% from last year and signals a possible extension of the rebound from the prior two months of declining sales. The month’s inventory of single-family homes for July came in at 6.2 months, which is the fifth consecutive year-over-year increase and does signal that new listings are outpacing sales, but still remains more of a seller’s market.

Single-family Homes Update

The overall median price of single-family homes of $155,100, while still the fourth highest median ever for the Houston market, is the first month without a year-over-year increase since the summer of 2004 with a 0.5% decrease from the prior year. The average sales price for single-family homes was $209,339 during July, which was up 1.8% versus the same period last year and was also a record high for the month of July in Houston. The median is a typical market price where half of the homes sold for more and half sold for less than that figure.

Houston’s current median price of $155,100 is 32.7% less than the national median price, which reached $230,300 in June, according to statistics released by the National Association of Realtors®. These data continue to show the tremendous value and lower cost of living afforded to Houstonians.

Additionally, total sales for single-family homes in Houston in July came in at 6,856, which was 1.6% higher than July 2006 and reversed the previous two months of declining sales. Year-to-date sales remain negative this month, down 0.4% versus the first seven months of 2006. While it is little more than half way through 2006 and still too early to tell, Houston has not experienced an overall yearly decline in more than a decade so this is something to watch as the year progresses.

HAR also reports existing home statistics for the single-family home segment of the real estate market. For the month of July 2007, existing single-family home sales totaled 5,895, which was a 3.9% increase from July 2006. The median sales price for existing homes in the Houston area was $150,000, only a slight 0.1% increase compared to the same period last year. The average sales price for the month of $198,219 was an increase of 2.4% from last year’s level.

The Days on Market statistic for July was 76 days, which is historically low and shows that the homes that are selling are selling more quickly.

Townhouse/Condo Update

The overall median price in the townhouse/condo segment in Houston was up 1.2% for July, with the median sales price for the month being $122,000. The average sales price for which a townhouse or condo sold in the greater Houston area was $159,401 in July 2007, which was an 8.2% increase from the same month last year.

Additionally, the number of townhouses and condos that sold in July extended its trend, with the third monthly decline in a row compared to the previous year’s sales. In the greater Houston area, 660 units were sold last month, versus 681 properties in July 2006, or a 3.1% decrease in year-over-year sales.

Houston Real Estate Milestones in July

- Highest average single-family home sales price for the month of July
- Highest ever number of single-family homes listed for sale
- Highest number of homes ever sold in July
- Fourth highest median sales price in Houston history

Houston housing construction facing slowdown

NANCY SARNOFF
Houston Chronicle

The number of homes built in the Houston area is expected to drop in 2007 for the first time in more than 10 years.

Builders are projected to construct roughly 40,000 homes this year, a slowdown of about 20 percent from last year, when home building reached its peak here, said housing analyst Mike Inselmann today at the Greater Houston Builders Association mid-year forecast luncheon.

The reasons for the slowdown have to do with public builders cutting back production nationwide and a meltdown in subprime lending, loans to borrowers with bad credit.

Still, this slower pace has not been the result of a sluggish economy, but rather brought on by the industry itself, Inselmann said.

"Things are just fine," he said. "They're not as good as we want them to be, but there's a recovery in our future."

Lower-priced homes — which are more often financed with subprime mortgages than higher-end ones — will be the hardest hit during the coming months.

Subprime loans amounted to nearly 17 percent of all the mortgages in the Houston area last year, compared to 14 percent nationwide.

"These buyers are being shut out of the market right now. It's going to take a while until we see a resolution to that issue," said Inselmann.

Other parts of the local market are strong, including move-up homes — higher-priced properties geared toward buyers purchasing their second or third homes.

Houston gets expert advice on what kind of city to be

Urban historian says pro-business stance still works, but professor calls lifestyle new No. 1

By MIKE SNYDER and MIKE TOLSON
Copyright 2007 Houston Chronicle

Just be yourself, Houston.

That was the essence of the message delivered to the Greater Houston Partnership on Tuesday by urban historian Joel Kotkin, who urged the region's leaders not to be seduced by strategies focused on luring the "creative class" of hip young professionals.

Instead, Kotkin argued, Houston should continue its traditions of low taxes and limited regulations to maintain a favorable business environment and a low cost of living. Local governments, he said, should focus on expanding highway capacity and improving street and drainage systems.

"Downtown Houston will never be Midtown Manhattan," said Kotkin, a senior fellow at the New America Foundation, a Washington-based think tank, and the author of several books on urban issues.

In a report commissioned by the partnership, entitled "Opportunity Urbanism: An Emerging Paradigm for the 21st Century," Kotkin argues that quality-of-life issues such as parks and cultural amenities need not be a top priority of local leaders.

These amenities, he said, develop organically in cities with strong economies that can help lift working-class people into the middle class.

Mayor Bill White said he agrees with Kotkin's description of Houston as an "opportunity city" that's open to new ideas and new residents from diverse backgrounds.

But Stephen Klineberg, a Rice University sociology professor who has studied Houston for 25 years, said Kotkin's analysis represents a "serious misreading of the new competitive environment facing American cities like Houston in the 21st century."

Kotkin doesn't place enough emphasis on the need to provide a good education to the immigrants and other ethnic minorities who make up most of the Houston area's younger population, said Klineberg, who spoke briefly at the partnership luncheon after Kotkin's speech.

"If Houston is to have anything like the skilled work force we will need in the years ahead," Klineberg said, its leaders must "ensure that all children in Houston, regardless of their parents' incomes, have access to quality health care, to affordable housing and, above all, to truly effective public education from preschool through college."

Kotkin's report highlights the relatively low cost of owning a home in Houston compared to "superstar" cities such as San Francisco and Boston, where most middle-class families can't afford a single-family home.

Access to homeownership was a key motivation for Dave Brown, who moved to Houston from New York City six years ago.

From the lofty perspective of his mid-Manhattan office tower, Brown looked out and saw not the hip and happening center of the universe but a personal and financial dead end. Seven years in a small apartment with a savings account that never seems to grow will do that.

"Something needed to change," said Brown, who worked in human resources and staffing for an information-technology firm. "I didn't think in New York I could obtain the American dream of owning a house and having money in the bank."

A chance trip to see a friend led to a job interview and ultimately a new lifestyle, admittedly far removed from his rural childhood in North Dakota but equally distant from an economic hamster wheel where a stable job seldom translates into upward mobility.

"I also interviewed in Chicago and Minneapolis, but the job and people weren't what I found in Houston," said Brown, 35, who works for an IT consulting firm.

A local recruiter said Houston doesn't deserve its reputation as a hard sell with a bad climate, dull geography, overwhelmed freeways and a vague identity.

"It's a growing city with lots of opportunity," said Marsha Murray, president of Murray Resources, a professional staffing firm. "Houston has a very good reputation to live and raise a family in. A lot of people, believe it or not, prefer the climate. They like it where it's warm. But what we're hearing more and more are good reactions to the school districts and neighborhood environments and the cost of living."

All of that resonated with Toby and Martha Lazor, who just closed on a house in Sienna Plantation, a master-planned community in Fort Bend County, and will be moving in next month. The surroundings may not be quite as pretty as the rolling woodlands around their current home near Stamford, Conn., but the tradeoff seems small in the big picture.

"We'll have 1,000 square feet more in our house, and the price is 45 percent of the cost of our home here," Lazor said. "I don't mind going from a very hefty mortgage to a minimal one. Our children will be able to walk to school. I think the city offers a good range of everything, and I can play golf year round."

The amenities Lazor enjoys so much, however, are not as readily available in many parts of central Houston, where new development is rapidly paving over the remaining open spaces.

This is one reason Klineberg and others said Kotkin should not be so dismissive of quality-of-life issues. Cultural attractions and green spaces are important not only to elites but to "all the levels of talent that we are seeking to attract to this city," Klineberg said.

The discussion of quality-of-life issues in Kotkin's report centers on his criticism of another author, Richard Florida, who has argued that the most successful American cities will be those that attract members of the creative class of well-educated young professionals.

Florida, a public policy professor at George Mason University in Fairfax, Va., said Kotkin is misrepresenting his work and setting up a false choice between creative and opportunity cities. Houston, Florida said, represents both.

``My own interactions with Houston leadership in the early 2000s and visits to neighborhoods like Montrose were inspirational to my creative economic development theory,'' Florida said in a written response to questions from the Houston Chronicle.

Kotkin argues that this is an elitist strategy that can succeed in only a handful of cities that can thrive as enclaves for the wealthy. Houston and most other cities, he said, should focus on keeping homeownership and other economic opportunities available to working- and middle-class families.

Economist: Houston Housing Market Uncertain

Last Edited: Tuesday, 08 May 2007, 7:11 PM CDT
Created: Tuesday, 08 May 2007, 7:11 PM CDT

The growing number of foreclosures and worries about the real estate bust has everyone thinking about what to expect. Those who have not been affected by the foreclosure wave find themselves putting their money into foreclosed property at a very low rate.

Economist Barton Smith with the University of Houston says the national housing market still it hasn't leveled, and is far from it, prompting everybody to talk about, the National Association of Realtors included.

Even more, the slowing down housing market will probably have negative implications for a national economy already with ups and downs. "There are many regional markets in the country in which the severity of the housing correction has already reached to a level that will probably slowdown the U.S. economy even more," said Smith before more than a thousand people at his symposium Houston's Twin Booms: Energy & Housing-Will Continue for Another Year?

Smith is director of the Institute of Regional Forecasting at UH, and very year he presents the symposium focused on the real estate business.

Smith said the main maladies of the country's housing markets are excessive prices, overbuilding and foreclosure rates. Houston is suffering from an unusual high foreclosure rate compared to other markets such as California. Houston housing prices are relatively stable building new houses within the metropolitan area is still fairly modest.

Smith predicted Houston's economic growth it will slow down, but is still better than the national average.

Houston-area home prices continue to climb

Despite the good news, prices lost steam and early 2007 sales were down

By NANCY SARNOFF
Copyright 2007 Houston Chronicle

Houston-area home prices continued their steady climb last year as the rising tide of the energy industry helped lift sales and property values.

The overall median price per square foot for a home in the area rose 4.3 percent in 2006 to $73.05 at a time when many once-hot markets were in decline.

Despite last year's good news, uncertainty hangs over the Houston housing market.

Prices lost steam in the second half of the year, and last month's home sales were down for the first time since January 2004.

Reasons for the shift include a national housing slowdown that tempered the pace of homebuilding and a mortgage industry crackdown on subprime lenders, which make loans to borrowers with marginal credit.

"We got an unexpected sucker punch from this whole subprime mortgage issue, which is creating a lot of anxiety and hysteria," said Mike Inselmann, president of Houston-based consulting firm Metrostudy.

Industry experts question whether this year will be as strong for sales and prices, as subprime lenders pull back from loaning to borrowers with far-from-perfect credit, who make up a significant share of the local market.

Troubling national headlines have made some would-be buyers nervous.

"Even if they want a house, they might say, 'Let's just renew our lease for another six months and wait until this settles down,' " Inselmann said.

Still, many people who make a living in real estate say any drop in the Houston market is likely to be limited by the city's strong energy-related economy and growing population.

Though some housing markets across the country have seen home prices soar and then fall, Houston's residential market has been relatively uneventful in comparison, with years of moderate gains.

The median sale price for a single-family home in the Houston area was $149,800 last year. That compared to the national median of $222,000, according to the National Association of Realtors. The median indicates half the homes sold for more and half for less.

Since 1992, the average annual appreciation rate in the Houston area has been 3.9 percent, said Evert Crawford of Crawford Realty Advisors, which conducted the study of home sales handled by the Houston Association of Realtors' Multiple Listing Service. This study was done in conjunction with the University of Houston's Institute for Regional Forecasting.

The study looked at home sales primarily in Harris, Fort Bend, Montgomery, Galveston and Brazoria countries. Last year's price information was based on 72,225 MLS transactions in more than 2,000 neighborhoods. Those were primarily used-home sales, with 18 percent of them new.

Based on historical data, home prices in many of the established inner-loop neighborhoods that don't have room to grow have appreciated faster than those in the suburbs, where home sellers are competing with new construction.

Prices per square foot fell in about 525 of the neighborhoods surveyed. Of those, almost three-quarters were beyond Beltway 8, the city's outermost traffic ring.

Though the highest appreciation areas are typically inside the loop — which saw a 6.1 percent increase in prices per square foot last year — about 80 percent of the sales were outside the Beltway.

Many of the buyers are newcomers such as Stacey and Brad Kniff, who recently moved from Austin when Brad took a job here. The family of four bought a 5-year-old home in a gated community in Cinco Ranch, in part because of a belief that the area would appreciate.

Home prices per square foot were up 9.1 percent last year in the city of Katy, an area west of Houston that's near the growing corporate campuses housing some of the world's largest oil and gas companies.

The Kniffs closed on their two-story stone and stucco home last month. They paid $540,000 for the five-bedroom, 4,900-square-foot home that has a media room, game room, office and swimming pool.

The family, with two young girls, also liked all the neighborhood pools and golf courses.

"For raising a family it was the best of all the worlds," said Stacey Kniff, 32. "The only negative about living in Katy is you don't have the restaurant choices you have in Houston."

The most affordable houses are typically found in suburban Houston, where cheap and plentiful land has created a huge market for new homes aimed at first-time buyers.

Some of the new-home inventory is sitting vacant, as buyers with poor credit can't close on their loans after lenders started putting the brakes on subprime mortgages.

There are builders offering deep discounts.

Angela Smith-Davis bought a new home last month in Fort Bend County after the builder was willing to drop the price by $23,000.

Smith-Davis, a 50-year-old recent retiree from AT&T, said she paid $142,000 for the three-bedroom brick home in the Cambridge Falls subdivision in Fresno.

Her credit score was below 620, the level at which many borrowers must take out subprime loans, but she was able to quality for a state-sponsored bond loan, which provides first-time buyers low-interest rate mortgage financing.

She said she used a portion of her 401K for a $37,000 down payment, and plans to get another job to help pay the monthly note of $1,054.

Entry-level homes have made up more than half of the Houston area's new home sales in recent years, according to Metrostudy. Builders now are trying to reduce their risk if tougher lending standards hurt their sales.

Metrostudy's Inselmann expects a 10 to 20 percent slowdown this year in construction. But he doesn't think prices will be affected, at least not in the long run.

"When you end up with some surprise inventory you're going to run specials and do deals to move those houses, but we don't have so much of it," he said. "In 90 days we could clean all of that up. The market is still strong."

Other buyers see affordability in a different light.

Prices were up 8.1 percent last year in the pricey Southgate neighborhood bordering Rice University where Brian and Meredith Beebe recently bought a home.

The couple and their two small children moved from Raleigh, N.C., last year after Brian Beebe took a job as an energy marketer. The Beebes were expecting to find reasonably priced housing when they arrived.

"When we told people we were moving to Houston they all said, 'Oh, it's so affordable,' " said Meredith Beebe, 34. "We got kind of sticker shock looking because that's not the case inside the loop."

They wanted to buy near the elementary school they had chosen for their son in Southgate, where the median market price was nearly $410,000 in 2006, according to Crawford.

The Beebes settled on a three-bedroom home in Southgate with a second-story addition.

They wouldn't disclose what they paid for the home, but said it was at the top of their price range.

They would have liked to have had more bedrooms, but they sacrificed size for the location, which allows them to walk to shops, parks and their son's school.

Home sellers outside the Beltway must deal with competition when trying to sell their house.

Shad Bogany, of ERA Bogany Properties, said it took him 18 months to sell a well-maintained 2,500-square-foot home with hardwood floors in a gated neighborhood in Spring's Cypresswood Lakes, an area close to new construction.

Agents say sellers need to make sure their house shows well, and they're looking for ways to highlight any updates.

For resales, Bogany now markets properties by using virtual tours, adding more photos to online listings and promoting the homes on local television home sale shows.

''We're finding you've got to do more than put the sign in the front yard," he said.

The full impact from the subprime lending pullback is still a wild card in Houston, experts say.

University of Houston economist Barton Smith just started a research project on the number of households that will be taken out of the housing market with fewer subprime loans available. Early estimates indicate it could be up to 100,000.

"That game is over, Smith said. "And that part of the market I think is going to be greatly diminished."

Rate of increase of Houston home sales slows

Houston Business Journal - 2:07 PM CDT Tuesday, March 27, 2007

Houston-area residential real estate sales continued to grow and out pace most of the nation in February, although the rate of increase has slowed from recent years, according to the Houston Association of Realtors.

Though property sales in the greater Houston area have not suffered the pronounced drops experienced by many other major U.S. metropolitan markets, the past several years of less stringent lending standards and local foreclosures have been cited as possible contributors to any slowdown.

"With the reports across the country of rising foreclosures and concern about the impact of sub prime lending, we in Houston must watch for any indication of a weakening market," said Rob Cook, HAR chairman.

"Houston is still one of the most solid real estate markets in the country, and we do not anticipate any dramatic downturn locally."

Most categories of Houston's housing market saw increases in February.

There were 5,991 property sales, a 2.6 percent increase over February 2006. Properties sold during the month were valued at more than $1.1 billion, a 5.7 percent increase compared with nearly $1 billion in February 2005 sales.

The median home price for a single-family home in February was up 2.5 percent over February 2006 to $146,000, while the average single-family home price was $195,561, 2.6 percent higher than in February last year.

Houston's median price of $146,000, while a record for the month of February in the local market, is 30.8 percent less than the February national median price of $211,100, according to NAR statistics.

Total sales of single-family homes in Houston were up 3.8 percent to 4,868, compared with 4,688 in February 2005 -- the 37th consecutive monthly increase.

Houston, the Oil Town, Is Sharing in a Boom

By KRISTINA SHEVORY

HOUSTON — The good times are back.

Galvanized by the record profits at energy companies, this city, the center of the country’s energy industry, has shaken off the effects of the Enron implosion six years ago and is enjoying its strongest resurgence in more than 20 years, business officials and real estate developers say.

Some energy companies are expanding and putting up new buildings. Others, like Citgo, Schlumberger and Halliburton, have moved their headquarters to Houston. Oil and natural gas companies have helped reduce office vacancy rates to 15 percent, a five-year low, according to Grubb & Ellis, a real estate company. Job growth is double the national average — 97,400 jobs were created in 2006. The National Association of Realtors says the housing market in Houston is one of the strongest in the country.

“The increase in the oil business has made Houston,” said Randall Davis, a Houston condominium developer. “It feels a touch like the 1980s — everyone is out, the restaurants are full, the bars are full. It’s like New York.”

The good news extends across the city. The port recently opened a $1.4 billion container terminal to tackle soaring traffic. In 2006, it handled 1.6 million 20-foot containers, up 29 percent from 2003. At the Texas Medical Center, hospitals and universities are investing billions in new facilities. Residential and mixed-use developments are going up downtown.

The Houston economy has been growing since 2004, when energy companies started investing more in big-ticket projects and hiring thousands of employees to run them. Before that, oil companies had been hesitant to pour more into exploration and production, because they had lost millions in the past when oil and natural gas prices collapsed.

“There was always a real reluctance to buy into the commodity cycle,” said Robert W. Gilmer, vice president and senior economist at the Federal Reserve Bank of Dallas.

Those fears are long gone. Real estate investors, enticed by rising rents and occupancy rates, are returning. Over the last five years, sale prices for office buildings in Houston have climbed by 34 percent, to an average of $129 a square foot in 2006, according to Real Capital Analytics, a national research and consulting firm. Compared with other large cities nationwide, like Chicago and San Francisco, where prices average $191 and $338 a square foot, respectively, Houston is still a relative bargain.

“The office investment market has taken off,” said Ariel Guerrero, Texas research and client services manager at Grubb & Ellis in Houston. “If you look at the price per pound, there’s still value.”

Brookfield Properties, a New York-based real estate investment trust, seems to think so. Last October, Brookfield became the biggest landowner in downtown Houston when it joined with the Blackstone Group to buy Trizec Properties for $8.9 billion in cash and debt. The deal gave Brookfield eight buildings in Houston, for a total of 7.4 million square feet.

Although the merger included properties nationwide, Richard B. Clark, the chief executive of Brookfield, said Houston was one of the deal’s attractions. (Almost a quarter of Brookfield’s portfolio is energy-related.)

Chevron signed a lease shortly afterward for one of the buildings — the 1.2-million-square-foot tower that used to be Enron’s headquarters — and plans to move in this year. The lease, Brookfield says, was the biggest in the country since 2000 and lowered the availability rate for Class A space downtown. In the fourth quarter, the rate dropped six percentage points, to 12 percent, according to Grubb & Ellis.

“This confirms our belief it’s a strong market,” Mr. Clark said. “I think our timing is good, fundamentals are improving and tenants have confirmed that they’re growing.”

Brookfield is banking that Houston will grow even more. It is considering putting up a new office tower downtown, Mr. Clark said, but is holding off until the availability rate for Class A office space drops below 10 percent. He said he expected it to reach that point within a year.

Encouraged, developers have started building again. In the fourth quarter, 2.4 million square feet of office space was under construction, more than double the amount in the third quarter. For the first time in years, developers are building without a signed tenant, though most projects are typically smaller than 500,000 square feet.

Nowhere is the growth more apparent than in the city’s Energy Corridor. Straddling Interstate 10 west of downtown, the area — home to companies like BP, Royal Dutch Shell, ConocoPhillips, Exxon Mobil and Citgo — has become one of the strongest real estate markets in the city. Occupancy rates are at 92 percent, the highest in the city, and rents average $19.26 a square foot, according to Grubb & Ellis.

“When occupancy rates reached the mid-90-percent range and there were no blocks of space, we said, ‘Hey, maybe it’s time to build,’ ” said Aaron Thielhorn, a principal at Trammell Crow in Houston.

Last October, Trammell Crow broke ground on a 330,000-square-foot building in the Energy Corridor without a signed tenant. Construction is to begin this summer on a second building. The two-building project is now the largest under construction in the Energy Corridor.

Speculative office buildings are also going up in places like the Galleria and downtown, which have less available space. Work on Houston Pavilions, a $170 million complex with retail space, restaurants and music clubs as well as a 13-story office tower, began downtown in February. The Texas Real Estate Fund and the Entertainment Development Group, the builders of the project, have not yet signed an office tenant.

“If you would have told me six years ago I’d be investing $170 million downtown, I’d have said you were nuts,” said William Denton, chief executive and president of the Entertainment Development Group of Agoura Hills, Calif. In those days, he said, downtown Houston often seemed virtually empty.

Of course, it is an open question whether the good times are here to stay and for how long. Only six years ago, Enron collapsed, the Arthur Anderson accounting firm imploded and Houston was hit hard when the national economy staggered after the Sept. 11 terrorist strikes.

[Halliburton announced Sunday that it would move its chairman and chief executive, David J. Lesar, from Houston to Dubai and open a corporate headquarters there. Analysts say, however, that the Halliburton move will not lead to a general exodus, because Houston is still the country’s energy capital.]

Oil and natural gas prices could plummet, some worry, and stall Houston’s economy. About half of the city’s jobs, or 1.1 million positions, are tied to the energy industry.

“One thing we’ve learned, whether it’s real estate or the oil industry, is that we’re always looking over our shoulder,” said James Arket, senior vice president at Grubb & Ellis in Houston. “No one takes anything for granted.”

The Greater Houston Partnership, an organization of businesses, is not waiting for the economy to slow. In 2006, it started a $40 million effort to diversify the local economy and bring 600,000 new jobs to the area over the next decade. Typically, the city creates 45,000 new jobs a year.

“It’s one of those gulp-and-hold-your-breath figures,” said Jeff Moseley, president and chief executive of the partnership. “The economy is very robust, but we’re going forward because we know the economy will cool off.”

Nation's housing slump becomes even worse

By MARTIN CRUTSINGER
Associated Press

WASHINGTON — The slump in housing deepened in the final three months of last year, with sales falling in 40 states and median home prices dropping in nearly half the metropolitan areas surveyed.

Formerly red-hot areas were among the hardest hit as the five-year housing boom cooled considerably in 2006.

But in Texas, sales volume picked up at a rate of 6.1 percent in the fourth quarter compared to a year earlier. In the Houston area, the median used home price reached $148,600 in the fourth quarter, a 1.6 percent increase over the same period a year earlier.

In other economic news, industrial output fell in January by the largest amount in 17 months, reflecting huge cutbacks at auto factories and weakness in housing-related industries. The Federal Reserve reported Thursday that output at the nation's factories, mines and utilities was down 0.5 percent in January, the biggest setback since Hurricane Katrina disrupted activity in the fall of 2005.

And the number of newly laid-off workers filing claims for unemployment benefits jumped by 44,000 to 357,000 last week, the Labor Department said. It was the largest one-week increase since September 2005 after Hurricane Katrina. Part of the increase in jobless claims last week was due to a blast of cold in the Midwest and Northeast, which triggered higher layoffs in such industries as construction.

While some economists said they believed the worst may be over for housing nationwide, others predicted more price declines to come until near-record levels of unsold homes are reduced.

The National Association of Realtors said the states with the biggest declines in sales from October through December compared with the same period in 2005 were: Nevada, down 36.1 percent; Florida, down 30.8 percent; Arizona, down 26.9 percent; and California, down 21.3 percent.

Could area in Houston's East End be the new Midtown?

It opened in 1985, but never really amounted to anything. It now has many developments, including lofts, and some people say it's finally getting off the ground 20 years later.

It seemed like a good idea on paper, a Hispanic themed entertainment mall, but El Mercado fell so flat it was sold at auction. It was resurrected as luxury condos, but that didn't work either. Five years ago, it was bought by Dallas-based Trammel Crow and turned into a 250 unit apartment complex, now called The Alexan Lofts where Oscar Uvillus lives.

"Basically the area downtown is good for commutes and other issues about transportation," said Uvillus.

Notice he said downtown. Leasing agent John Welch refers to this as the new Midtown.

"Midtown is the new exciting place from downtown to Midtown and eventually that's going to be run out of there and this will be the new Midtown area," said Welch.

In reality, this is the westernmost part of the East End or Second Ward which has been waiting for the land rush for years. Now it seems to be starting in the last part of Houston to see townhomes.

"There's nowhere else to go but east if you wanna stay inside the loop," said developer Amaz Inamdar.

It's a study in contrasts, quarter million dollar town homes going up next to soup kitchens and a large homeless population. In areas where large retail is nearly nonexistent, that too is part of being an urban pioneer.

"The downfall is that we don't have that many restaurants around here or grocery stores," said Welch.
(Copyright © 2006, KTRK-TV)

Commercial Real Estate

Sales
LAND: Lost Boulder Partners bought 1.15 acres for an Advanced Auto Parts at Lee Road and Aldine Bender Road. The seller was Woo Hin Wai, represented by Mark Wimberly of the Betz Cos.

RETAIL: A 10,000-square foot shopping center in Rice Village at 2520 Times Boulevard has changed hands between two Sugar Land-based investors. The center had a list price of $1.8 million and was built in 1945. Paul Gardner of Marcus & Millichap brokered the transaction.

OFFICE: Coldwell Banker United Commercial Realtors handled the sale of an office building at 630 Murphy Road in Stafford. Marvin Gerber of the Uptown office represented the seller, Gary Becker of Henderson, Nev. Danny Markowitz of the Bellaire office represented the buyer, VFL of Bozeman, Mont.

RETAIL: DC ACQ a Michigan company, purchased the 14,550-square-foot Walgreens at 2605 W. Holcombe from the Holcombe Kirby Investors Ltd. Sandy Aron and James Bouterie of Hunington Properties represented the seller.

LAND: TCR GC Development purchased 20 acres at 9511 Grant Road. Timothy Clay of Clay & Co. represented the seller, Doran Jones, and Lawrence Thompson of Moody Rambin Interests represented the buyer.

Leases
OFFICE: Reliant Energy Retail Services signed a five-year lease in the Total Plaza, 1201 Louisiana. Previously subleasing space in the building, Reliant has signed a new lease that begins in September. Reliant will occupy 101,000 square feet on four floors. Bob Cromwell of Moody Rambin Interests represented the building owner, Coast Range Investments. Stewart Robinson of Conine & Robinson represented Reliant. The building is 90 percent occupied.

OFFICE: Export Service International Forwarding leased 11,500 square feet at 6546-A Petropark Drive. Timothy Clay of Clay & Co. represented the tenant. Jarret Venghaus of Staubach Co. represented the landlord, J&H Realty.

BAKERY: Dessert Gallery Bakery & Café leased a 2,711-square-foot space at 2260 Lone Star Drive in Sugar Land Town Square for a third location in the Houston area. Dessert Gallery is a gourmet dessert shop that also serves sandwiches, wraps and salads. Bruce Frankel of Planned Community Developers represented the landlord, Town Center Lakeside Ltd.

INDUSTRIAL: International Maywood Metals leased a 21,924-square-foot building at 12390 State 249. The tenant was represented by Michael Biggs of Ultima Real Estate Services. Travis Land and John Ferruzzo of NAI Houston represented the landlord, MLT Investment.

INDUSTRIAL: American Woodmark leased 13,000 square feet at 10646 W. Little York. The tenant was represented by Darren O'Conor of NAI Houston. Walter Menuet of Vantage Houston represented the landlord, Vantage Houston.

WAREHOUSE: Furniture Basix leased 10,005 square feet at 1224 N. Post Oak. The tenant was represented by Darren O'Conor of NAI Houston. Clay Reichenbach of Insite Commercial Real Estate represented the landlord, Great American.

RESTAURANT: Tacone Flavor Grill leased 1,406 square feet at 2228 Texas Drive in Sugar Land Town Square for its first Texas location. David Wise of The Retail Properties Group represented the tenant. Bruce Frankel represented the landlord, Planned Community Developers

RESTAURANT: Mi Luna, a Spanish tapas restaurant and bar, leased 3,694 square feet at 2298 Texas Drive in Sugar Land Town Square for its third Houston-area location. Mike Zatopek of Resource Commercial Real Estate Services represented the tenant. Bruce Frankel represented the landlord, Planned Community Developers

OFFICE: Amica Mutual Insurance Co. leased 13,108 square feet at 2277 Plaza Drive in Sugar Land Town Square. R. Donald Janssen Jr. represented the landlord, Planned Community Developers. Don Wenig of Blackacre Advisors and Randy Wilhelm and Mary Dadura of NAI Houston represented the tenant.

RESTAURANT: Chili's leased 49,500 square feet at Pearland Parkway and FM 518 in Pearland. Jim Smith of Staubach Retail represented the tenant. Jamie Boutterie of Hunington Properties represented the building owner, John Kelly of the Maverick Group. The restaurant is scheduled to open in January.

RESTAURANT: Lupe Tortilla leased 1.18 acres at FM 1960 and W. Lake Houston Parkway in the Atascocita area. Jim Smith of Staubach Retail represented the tenant. Matt Keener represented the building owner, Trammell Crow Co. The restaurant is scheduled to open in the summer.

RETAIL: Mancuso Motorcycles leased 32,037 square feet at 7537 Southwest Freeway. Jim Smith and Jonathan Moseley of Staubach Retail represented the landlord, Houston Baptist University. Richard Lettice represented the tenant.

RETAIL: Mambo Seafood leased 5,000 square feet in Oak Village Shopping Center, 10002 Long Point from Mia Reed & Co. Capital Fund VII. Bob Moers with Bob Moers Properties represented the tenant. Austin Davis and Will Davis with Fredricks Commercial Brokerage represented the landlord.

OFFICE: Page Parks and Page Parks School of Modeling leased 8,361 square feet at 1535 West Loop South, Suites 100 and 110. Brent Fredricks and Will Davis with Fredricks Commercial Brokerage represented the landlord, Mia Reed & Co., Capital Fund VIII.

RETAIL: Linens N Things leased 28,300 square feet in Baybrook Gateway at I-45 and Bay Area Boulevard. The store is slated to open in April 2008 and will be one of three tenants to occupy a former Kmart building. Michael Thum of Woodmont Co. represented the landlord, Eastfield Realty. Keith Bierly with Katz and Associates represented Linens N Things.

RESTAURANT: Panda Express signed a ground lease of 35,000 square feet in Baybrook Village for a Chinese restaurant slated to open early next year. Michael Thum of Woodmont Co. represented the landlord, Midbrook First Realty. Walter Salek with Read King represented Panda Express.

RETAIL: ATA Black Belt and Karate for Kids leased 3,986 square feet in Cochran's Crossing shopping center from Regency Centers. Cochran's Crossing is at Research Forest Drive and Gosling Road in The Woodlands. The 138,192-square-foot shopping center is anchored by Kroger.

RESTAURANT: Subway has leased 1,200 square feet for a sandwich shop in the Cypress Landing Shopping Center at FM 1960 and Aldine Westfield. Shawn Ackerman and Paul Paraskevopoulos of Henry S. Miller Commercial represented the landlord, Shomer III Ltd.

RETAIL: Dress Barn leased 7,500 square feet in The Shops at Riverstone at Texas 6 and Riverstone Boulevard in Missouri City and 4,000 square feet in Cypress Town Center at the southeast corner of U.S. 290 and Spring Cypress. Tracy Sarver of Lasco Development Corp. represented The Shops at Riverstone. Clay Trozzo of Property Commerce represented Cypress Town Center. Cyndee Smith of NewQuest Properties represented the tenant.

RETAIL: Carter's leased 3,990 square feet for a children's apparel store in The Crossing at FM 518 and Kirby in Pearland from JEFCO Development Corp. Cyndee Smith of NewQuest Properties represented the tenant. Andy Aronson of JEFCO represented the landlord. Smith also represented Carter's in leasing 3,793 square feet in Town & Country Village at Beltway 8 and Memorial Drive. Ed James represented the landlord, Moody Rambin.

Etc.
RESTAURANT: Cordua Restaurants has leased a 9,000-square-foot retail space in the 21 Waterway Avenue building in The Woodlands Town Center for construction of Churrascos. The South American-style restaurant is scheduled to open in the spring, according to Dan Leverett of The Woodlands Development Co. The bi-level restaurant will feature a bar on the street level and dining room overlooking The Woodlands Waterway on the second level. The Woodlands location is being designed by Studio Gaia of New York, award-winning designers of several W Hotels, and Tao in the Venetian Hotel in Las Vegas.

RESIDENTIAL: Wilbow USA Corp., a Dallas-based residential real estate development firm founded by Australian William Bowness, is expanding from its base in north Texas to the north Houston area. Barton Woods in Conroe is a 242-acre development that will contain 588 lots. The development wraps around the 200-acre Barton Park, which features soccer and ball fields, a fishing lake and nature trails through the pine forest. Home sites will range up to half an acre. Wilbow also has projects in the Texas cities of McKinney, Prosper, Lancaster, Fort Worth, Celina and Keller.

HOTEL: CBL & Associates Properties announced that Courtyard by Marriott will join Pearland Town Center, a 1.2 million square-foot mixed-use development featuring 710,000 square feet of retail space. The 110-room, four-story hotel will be located above the center's retail shops near Macy's. Opening is planned in 2008.

Houston bucks national trend as housing market strengthens

Noelle Knox
USA Today
Nov. 1, 2006 12:00 AM

Houston's housing market is on track to set another record this year. While sales of existing homes nationwide have fallen for the past six months, they've been rising about 12 percent a month, on average, in Houston. Why?

"We have not had the (price) appreciation other areas have had," says Lorraine Abercrombie of the Houston Association of Realtors. "We just have a lot of different opportunities and different housing around Houston. I think people can find affordable housing everywhere."

Indeed, with home prices in the area one-third below the national median, they look downright cheap. And yet prices are up 6.7 percent this year.

Of course, gushing oil profits don't hurt, either. Houston's economy, while more diversified now with computers, aerospace and health care, still rises and falls with the oil industry.

The city of more than 2 million, the largest in Texas, continues to grow. And with plenty of vacant land around, construction is keeping up with demand. Construction permits for single-family homes totaled 36,128 through August, nearly 15 percent more than in the first eight months of last year.

Housing Starts Rise in September

Oct. 18, 2006, 8:13AM
© 2006 The Associated Press

WASHINGTON — Construction of new homes and apartments, which had been falling in the face of a weakening housing market, posted an unexpected increase in September.

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The Commerce Department reported that construction rose by 5.9 percent last month to a seasonally adjusted annual rate of 1.772 million units. It was the first increase after three consecutive monthly declines.

Analysts, however, still expect housing to move lower as builders continue to work through record levels of unsold homes. Building permits, a good sign of future activity, fell in September for an eighth consecutive month.

Rates on 30-year mortgages increase

By MARTIN CRUTSINGER AP Economics Writer
© 2006 The Associated Press

WASHINGTON — Rates on 30-year mortgages edged up slightly this week, after six consecutive weeks of declines.
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Mortgage giant Freddie Mac said Thursday that 30-year, fixed-rate mortgages rose to 6.47 percent this week, up from 6.44 percent last week.

It was the first increase since July 20 when 30-year mortgages hit a four-year high of 6.80 percent. Since that time rates had been declining as investors became more convinced that a slowing economy would keep inflation in check and forestall any further interest rates increases by the Federal Reserve.

Rates on 30-year mortgages will likely fluctuate for the rest of the year in a narrow range of between 6.5 percent and 7 percent, predicted Freddie Mac chief economist Frank Nothaft.

The Fed left interest rates unchanged at its Aug. 10 meeting, breaking a two-year period of rate increases. Many private economists believe the central bank, which next meets on Sept. 20, may be finished raising rates as long as inflation pressures continue to decline.

After hitting record sales levels for five straight years, home sales are expected to fall by around 10 percent this year as the once-booming housing market comes back to earth.

"Higher rates have resulted in houses sitting on the market for longer periods of time, changing the real estate sector into more of a buyer's market from a seller's market," Nothaft said.

Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, averaged 6.16 percent this week, up from 6.14 percent last week.

For one-year adjustable-rate mortgages, rates rose to 5.63 percent, up from 5.59 percent last week.

Rates on five-year adjustable-rate mortgages edged up to 6.14 percent this week, compared to 6.11 percent last week.

The mortgage rates do not include add-on fees known as points. Thirty-year mortgages and 15-year mortgages both carried a nationwide average fee of 0.4 point. One-year ARMS carried a nationwide average fee of 0.7 point while five-year ARMs carried a fee of 0.5 point.

A year ago, 30-year mortgages averaged 5.71 percent, 15-year mortgages stood at 5.30 percent, one-year ARMs were at 4.45 percent and five-year ARMs averaged 5.24 percent.

Houston's single-family real estate breaks records

Real estate sales in the Houston, Texas, market climbed for the ninth straight month in June, as single-family home sales and prices hit new highs, the Houston Association of Realtors reported today.

Total property sales, which include single-family homes, townhomes, multifamily homes, country homes, high-rise properties and lots listed on the MLS, totaled 9,166 in June, up 14.1 percent from June 2005.

Sales of new and existing single-family home sales set a record last month with 7,588 transactions, up 13.4 percent from last June's 6,694. The overall median price of single-family homes also nailed a record at $156,000, which was an increase of 7.2 percent compared to a year ago. The median is a typical market price where half of the homes sold for more and half sold for less than

"This market just continues to amaze all of us with each passing month. Our members are reporting that they have never seen it as busy as it has been so far this summer," said Lorraine Abercrombie, HAR chair and marketing director for Greenwood King Properties. "With interest rates also on course to rise during the coming year, this may be the best time for someone looking to buy or sell a home in the greater Houston area."

The number of available homes (active listings) at the end of June was 44,442 properties, which was a decrease of 2.1 percent versus last June and the 10th consecutive month with a year-over-year decline. The figure was an increase of 944 properties from last month though, which shows there are still plenty of available homes for purchase.

The months inventory of single-family homes, which estimates the number of months it will take to deplete current active inventory based on the prior 12 months' sales activity, came in at 5.4 months for June, unchanged from the previous month but down from a year ago. This statistic signals more of a seller's market and also shows that demand is more than keeping up with the available supply of homes.

The Houston Association of Realtors also reported:

* For the month of June, existing single-family home sales totaled 6,587, which was a 13.2 percent increase from June 2005. The median sales price for existing homes in the Houston area was $150,000, an increase of 8.3 percent compared to the same period last year.

* The number of townhouses and condos that sold in June increased substantially compared to last year's sales, with 856 units being sold last month, versus 708 properties in June 2005, or a 20.9 percent increase in year-over-year sales.

* The overall median price in the townhouse/condo segment in Houston was up 4.7 percent year-over-year in June, with the median sales price registering $125,000.

The Multiple Listing Service of the Houston Association of Realtors includes residential properties and new homes listed by 22,000 Realtors throughout Harris, Fort Bend and Montgomery counties, as well as parts of Brazoria, Galveston, Waller and Wharton counties.

Houston's average home price breaks $200,000-mark for first time

Houston Business Journal - 2:00 PM CDT Thursday
by Allison Wollam
Houston Business Journal

Houston home prices broke records in May, with the average single-family home price surpassing the $200,000 mark for the first time.

The average single-family home price for May was $204,005, up 8.2 percent over last year, according to statistics from the Houston Association of Realtors.

The median price -- which is the typical market price where half of the homes sold for more and half of the home sold for less than that figure -- also reached an all-time record of $152,000, up 5.6 percent from last year.

Houston's current median price of $152,000, while a record for the Houston market, is 31.7 percent less than the national median price, which reached $222,700 in April, according to statistics from the National Association of Realtors.

"While the rest of the country is talking about bubbles deflating, we continue to reach new heights in the Greater Houston real estate market," says Lorraine Abercrombie, HAR Chair and marketing director for Greenwood King Properties. "We know that for most people a home is their largest investment, so while we help them achieve their housing dreams, it is also good to know their investment will prove to gain value in the future. These numbers are definitely good news for our area."

Total property sales for the May 2006 totaled 8,629, an 11.6 percent increase over May 2005.

Properties sold during the month reached a total of nearly $1.7 billion, a 20.9 percent increase compared to last year's nearly $1.4 billion in sales.

Houston's overall housing market in May saw increases in most categories, including total property sales and overall total dollar volume on a year-over-year basis.

Month-end pending sales reached 5,892, which reversed last month's decline and was up 14.6 percent from last year.

Additionally, total sales for single-family homes in Houston continued a streak of year-over-year increases, marking 28 consecutive months that sales have been higher than the same month of the previous year.

For May 2006, single-family home sales increased by 11.7 percent to 7,199, up from last year's 6,443.

Meanwhile, the number of available homes at the end of May was 43,362 properties, which was a decrease of 3.6 percent versus last May and the sixth consecutive month with a year-over-year decline.

Houston's Wealthy Compete for Mansions as Oil Buoys Real Estate

May 31 (Bloomberg) -- Emily Burguieres and her fiance started house-hunting in Houston's most expensive neighborhood during December, expecting an easy search. What they found was a market where buyers must move fast.

``We made an offer on one that we were really excited about, but it was priced at a point where it had four other offers in one day,'' Burguieres, 32, said of a $1.5 million house in the city's River Oaks area. ``Our realtor told us it went over the asking price.''

As housing prices slow in much of the U.S., homes in River Oaks are selling faster, in larger numbers and at higher prices than a year ago. Growing demand at the top end reflects strength throughout the Houston market, which is getting a lift from soaring oil prices. The fourth-largest U.S. city is known as the world's energy capital.

``The energy business is making a lot of people wealthy,'' said Mike Inselmann, president of Houston-based researcher Metrostudy. ``Business is good for those folks, and they're spending money.''

First-quarter home sales in River Oaks rose 28 percent from a year earlier, and the value of homes sold jumped 55 percent to $32.3 million, according to local real estate firm Greenwood King Properties. The median selling price was $1.2 million, up from $940,000.

Burguieres, a financial analyst, and her husband-to-be, an energy trader, finally closed on a $1 million River Oaks home last week.

Energy Spending

Crude-oil, natural-gas and gasoline prices surged to all- time highs last year, spurring record profits for Houston-based ConocoPhillips, Halliburton Co. and other energy companies.

Producers and service providers, wary because of past boom- bust cycles, initially were reluctant to use their burgeoning cash flows to increase spending. That's changing, as shown by the 51 percent jump in exploration spending planned this year by Houston's Marathon Oil Corp.

``The oil industry has slowly come to believe that price incentives can be trusted this time and has finally begun to act on them,'' the Federal Reserve Bank of Dallas said in a March report.

That means good times in the Houston market, including River Oaks, an area east of downtown with tree-lined streets that attract oil barons, surgeons and lawyers. Some mansions sit on three-acre lots, boasting more than 10,000 square feet of space and price tags topping $10 million. That's in a city with a median home price of $147,000.

Faster Sales

The largest River Oaks property for sale is a 22,364-square- foot home built in the 1980s by a Saudi prince. Now owned by a real estate developer, the nine-bedroom residence sits on a 3.2- acre lot overlooking the Buffalo Bayou. The asking price: $8 million.

River Oaks' $2 million-and-over properties are selling within nine months, compared with 12 months a year ago and 21 months in 2003, according to Judy Thompson, a buyer's agent and publisher of WestURealEstate.com.

``Normally, you list a $2 million-plus property, you tell the seller it could take two years to sell,'' said John Daugherty, president of John Daugherty Realtors, which specializes in River Oaks. ``Today, we're seeing that they can sell them in six months.''

The oil boom is boosting home sales in other price levels as well. With half of Houston's jobs tied directly or indirectly to oil and gas production or refining, wage gains ``quickly filter through the rest of the economy,'' the Federal Reserve said.

Job Gains

The number of non-farm jobs in the Houston area climbed 2.7 percent in the past year, to an April total of 2.74 million, according to the Texas Workforce Commission. In the past five years, jobs in oil and gas extraction have jumped 13 percent.

Sales of previously owned homes in the area rose 4.6 percent in April from a year earlier, according to the Houston Association of Realtors. Nationwide, sales fell 10 percent.

One reason for the relative strength of Houston's housing market, realtors and economists said, is the city's slow pace of price gains in past years.

Houston's median home price rose an average of 4.3 percent annually from 2001 to 2005. That compares with price jumps of 18 percent in hot markets like San Diego and Las Vegas, according to National Association of Realtors data. Orlando, Florida's median price surged 44 percent last year and 17 percent in 2004.

Immune to a Crash?

``Since we haven't had this 20 to 30 percent inflation rate like California and the East Coast, we're not going to have the big fall, either,'' said Tom Anderson, a partner at Houston real estate firm Martha Turner Properties.

University of Houston Economist Barton Smith said the local housing market isn't immune to national trends. Inflation stemming from the high energy prices now benefiting Houston may lead the Federal Reserve to keep pushing interest rates -- and mortgage costs -- higher, Smith said in a May report. If housing prices crash nationally, he said, Texans will feel shock waves.

``It will all depend on the health of the national economy, and that, in turn, will largely depend on the fate of the housing market,'' Smith said.

Oil prices heat up Houston housing market

HOUSTON, TX, United States (UPI) -- Home prices in the Houston-area were up last year for the first time in four years.

The median price per square foot for a home rose 3.8 percent last year, after rising less than 1 percent in 2004, The Houston Chronicle reported.

Real estate agents and economists attribute the improved market to strong job growth thanks to the climb in oil prices.

The overall price increase was well below the 13 percent rise nationally in the median home price, but Houston`s slower pace may help the market avoid the sort of slowdown already seen in cities that registered tremendous gains in recent years, the newspaper said.

'We were never hot,' said Ted Jones, senior vice president and chief economist for Houston-based Stewart Title. 'What we have is a very dynamic market that`s not hot and not cold. We`re just right.'

The median price in Houston for 2005 was $70.04 per square foot, which would mean a 2,000-square-foot house would cost $140,080.

Copyright 2006 by United Press International

Five Questions With Real Estate Market "Professor"

4/23/2006 5:52:00 PM
By HoustonRealNews Market Analyst

HoustonRealNews asked Five Questions to Donald Jud, PhD. and Professor Emeritus at the University of North Carolina Greensboro on behalf of Houston real estate investors. We found his research on the risks associated with an individual property versus the risk of the property market on a national level enlightening. In that paper, co-authored by Stephen Roulac (PhD) and Daniel Winkler (PhD), Dr. Jud studied two specific markets in his research - his hometown of Greensboro and Houston.

1) Given your research comparing Houston to the national market, can you summarize the risk characteristics to an investor of only buying Houston single-family residences?

The risk of buying only one house is high in Houston and elsewhere is high. My research looked at 92,485 repeat sales of residential property in Houston during 1989-2004. The average annual capital gain return was 4.8 percent, but 68 percent of the home sellers earned a return that ranged from -0.6 to 10.2 percent. A total of 9.1 percent of the sellers sold at a loss, that is, for less than they paid for their property.

2) Investors in rapidly appreciating markets seemed to make money no matter what they bought, as long as they bought (markets such as Las Vegas , Phoenix and Boston in the first half of this decade). What factors should real estate investors look for to find the "best" deals in a market where everything is a "deal"?

My research shows that housing returns are higher:

1) when housing prices nationally are rising; 2) in communities where local employment is growing most rapidly; 3) for older homes; 4) for larger homes; and 5) for homes that are not atypical of the local area.

The risk of homeownership is lower for those buyers who stay in their homes longer before trying to resell. The risk of buying and then trying to resell quickly is very high.

3) How much do you believe that high carrying costs, such as higher than average taxes (3% +) and property insurance affect the value of Houston property?

My research and that of many others has shown that higher taxes and property insurance rates are capitalized in lower housing values. Housing values are always higher in places that have high quality public services and low taxes. The quality of local public schools is one of the most important public services affecting housing values.

4) What do you surmise is the influence of levels of immigration (all immigration - legal and illegal) on property values?

Immigration usually results in higher population and employment growth, both of which have been shown to raise housing demand and housing prices.

5) What advice would you give to investors in Houston single family real estate to hedge their risk?

Don't buy if you think you may need to resell quickly. Homeowners who live in their home can usually survive any market downturn. And while living in their home they earn the imputed rental value of the home, which is a tax-free return. For most homeowners this amounts to a 3 to 4 percent tax-free return after expenses, about the same yield as tax-free municipal bonds.

Some house owners may have more home than they need. This group may consider downsizing their housing investment.

Housing speculators, who buy with high leverage, using adjustable-rate mortgages and planning to resell quickly, face the highest risk. If the market slows and their house is vacant or if they are unable to rent at a rate that covers the mortgage payment, such investors may face default.

Study finds shortage of Houston housing for poorest evacuees

Associated Press

HOUSTON - A new study is raising concern that thousands of the poorest hurricane evacuees living in Houston could end up homeless when assistance runs out in the coming year.

The study commissioned by the Texas Department of Housing and Community Affairs found a shortage of almost 14,000 rental apartments affordable to the largest group of Hurricane Katrina and Rita evacuees. The income category is made up of families of five earning up to $26,360.

"The worst-case scenario would be a deluge of individuals heading toward services or headed for the streets," said Anthony Love, chief executive officer of the Coalition for the Homeless of Houston-Harris County.

He said it's hard to predict how many evacuees will become homeless, but agency leaders are discussing how to meet the additional demand.

City vouchers now cover rent for close to 35,000 hurricane evacuees. The vouchers will expire in September or October, although they could dry up sooner for the 6,700 evacuees who signed six-month leases.

Some evacuees will qualify for the Federal Emergency Management Agency's individual assistance program, which will provide cash payments that the tenants can use to pay their rent. That assistance will end next spring.

Evacuee Kemberly Samuels, 52, said she's reviewed Houston apartment listings and doesn't feel she can afford one on her own. She worked for the New Orleans public school system but can't find a job in Houston.

"I have no idea what I'm going to do," she said. "A lot of people are saying that they're just going to be homeless."

Alternatives to the city and federal assistance are limited. The waiting list for public housing in Houston already numbers more than 16,000 people. The list for federal Section 8 subsidized housing vouchers has been closed since 2001.

The state study found a surplus of 2,685 apartments that could be afforded by families earning from $27,000 to $40,000 annually - the income range primarily served by the federal Low-Income Housing Tax Credit program.

The government recently authorized $3.5 million more for the tax credit program to assist low-income housing development for evacuees in Texas. Under the program, states award tax credits to low-income housing developers, who sell them to investors to help pay for new building.

But some housing advocates said the study shows the program does not apply to the greatest need - the lower-income families displaced by the hurricanes.

In a newsletter, the Texas Low Income Housing Information Service calls for the tax credit formula to be expanded so that it would encourage the development of housing for the very poor.

State housing agency spokesman Michael Lyttle said the study was ordered to check the accuracy of market studies submitted by developers to support their applications for tax credits to develop low-income housing.

Healthy year ahead for housing market

Austin Business Journal - 10:27 AM CST Tuesday

The Austin area's new-home market will experience another strong year in 2006, according to a new market study.

Metrostudy Corp., a Houston-based consulting firm that tracks housing statistics nationwide, says 14,750 to 15,750 new units will be added to the Austin market in the coming year.

"This level of activity should keep anyone involved in our industry very busy this year," says Eldon Rude, Austin director of Metrostudy.

2006 should see continued strong housing demand in the Austin market, especially through the first half of the year, Rude says.

With housing prices expected to climb throughout the year, a key question will be whether income levels can keep pace with the price of housing in the region. This question mark, in combination with rising interest rates and the associated market cycle fatigue, might mean a moderate dip in demand before the market regains momentum in 2007.

The annual rate of new-home starts in the Austin region reached nearly 15,500 units in 2005, another record for the area, and the fourth consecutive year the annual starts rate has increased, Rude says. Consistent with the past four years, the demand for new homes has been strongest in the lowest price ranges -- those catering to entry-level buyers and families with low to moderate incomes.

However, housing demand has been strong across all price ranges, with all price levels experiencing increases in sales, even in the high-end segments.

Rude says Austin is one of the more competitive home markets in the country, leading to thin builder margins despite strong demand.

"The larger public builders continued to pursue additional unit and revenue volume at the risk of lower profits through the end of 2005," Rude says.

"We will have to wait to see whether such strategies persist into 2006 or whether builders accept lower volumes and attempt to raise prices in the spring season. Materials, labor and land and lot prices increased in 2005, and will continue to increase in 2006, intensifying the cost pressure builders face."

The level of active listings, or homes on the market, in Austin dropped to a 3.5-month supply in December 2005 -- a level of inventory that's low enough to push home prices higher, but not so high as to result in significant price appreciation in the near term.

In the past year, existing-home prices in Austin have risen nearly 6 percent after four consecutive years of minimal price gains.

"Clearly, it is difficult to make a case for a housing price bubble in Austin or anyplace else in Texas, for that matter," Rude says.

Housing market still soaring

Allison Wollam
Houston Business Journal

The Houston housing market is continuing on an upward trend, but the growth rate has slowed from last year's breakneck pace, according to statistics released by the Houston Association of Realtors Multiple Listing Service.

Total property sales for February totaled 4,925, which was a 4.6 percent increase over February 2004.

More than $836 million worth of properties changed hands during the month, which was a 10.1 percent increase compared to last year's $760 million in February sales.

Additionally, year-to-date total property sales reached 8,795, an increase of 3.5 percent over the first two months of 2004.

All listing categories combined, Houston's overall housing market in February experienced increases across the board including sales, available inventory, pending sales and overall total dollar volume on a year-over-year basis.

The number of available homes at the end of February was 42,330 properties, which was an increase of 11.3 percent versus last February and a new monthly record.

The month's inventory of single-family homes for February remained relatively flat at 5.9 months, which shows that demand is keeping up with the available supply of homes.

The overall median price of a single-family home reached $136,880 in February, an increase of 5.9 percent compared to the prior year. The average price for a single-family home reached $178,387, a 4.9 percent increase.

Houston's current median home price of $136,880 is 26.8 percent less than the national median price, which reached $186,900 in January, according to statistics released by the National Association of Realtors.

HOUSTON 2004 HOME SALES SURPASS 2003

More than 65,000 properties have changed hands in this record-breaking year

HOUSTON – (December 15, 2004) – Houston existing home sales once again set a new monthly record, as well as set a new annual sales record, even with one month remaining in the year, according to statistics released today by the Houston Association of REALTORS® Multiple Listing Service. Total property sales for November reached 5,222.

Additionally, year-to-date existing-home sales broke last year’s record-setting level, with 65,637 listings sold so far this year, a gain of more than 10 percent from the first 11 months of 2003. Year-to-date existing property sales through November 2003 totaled 59,491.

“Houston’s highly-affordable housing coupled with interest rates less than 6 percent and the creation of 27,700 net-new additional jobs in the past 12 months have energized housing demand and led to record sales,” said HAR Chairman and Stewart Title Chief Economist Ted C. Jones, Ph.D. “While 2005 may not top this all time record, Houston is in for an extended duration of significant housing demand. The Texas State Data Center forecasts that the Houston Metropolitan Statistical Area will grow from 5.3 million people in 2005 to 6 million by 2010—an average increase of 140,000 individuals per year. The combined demographic and economic demand portends rising home values and sales activity.”

All listing categories combined, Houston’s overall housing market experienced double digit percentage increases across the board including sales, available inventory, pending sales – those listings expected to close within the next 30 days – and overall total dollar volume on a year-over-year basis. Months inventory of single-family homes fell slightly from 6.1 months last year to 6.0 months in November 2004.

Single-family Homes Update
The median price of single-family homes reached $132,200 in November, only a negligible increase from the same month last year, but this month still marks the second highest median price ever recorded in the month of November in Houston. The median is a typical market price where half of the homes sold for more and half sold for less that that figure.

Houston’s current median price of $132,200 is 29.3 percent less than the national median price, which reached $187,000 in October, according to statistics released by the National Association of REALTORS®. These data continue to show the tremendous value and lower cost of living afforded to Houstonians.

Additionally, total sales for single-family homes in Houston increased by 22.0 percent to 4,323 in November from last year’s 3,544.

Houston Real Estate Milestones in September
# Reached the highest number of homes ever sold in the month of November.
# Surpassed total 2003 existing home sales, with one month remaining in 2004.
# Sold more than $11 billion worth of properties year-to-date.

The computerized Multiple Listing Service of the Houston Association of REALTORS includes residential properties and new homes listed by 19,000 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 40,000 properties can 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.

HOUSTON HOUSING SALES MAINTAIN A RECORD PACE INTO THE FALL

Month Still Marks Highest September Sales Ever; Remain on Course for Record-Breaking Year

HOUSTON – (October 21, 2004) – Houston’s residential housing market maintained a record pace following alltime high summer sales, according to statistics released today by the Houston Association of REALTORS® Multiple Listing Service. Total property sales for September reached 5,896, which once again represented the highest number of sales ever recorded in the month of September.

Additionally, year-to-date existing-home sales continue to rise ahead of last year’s record-setting pace, with 54,729 listings sold so far this year, a gain of more than 10 percent from the same period last year. Year-to-date existing property sales through September 2003 totaled 49,580.

“The summer is always the most active period for home sales so we anticipate a seasonal dip in sales from August to September. This is expected though as people settle into their fall routines and children return to school,” said HAR Chairman and Stewart Title Chief Economist Ted C. Jones, Ph.D. “September sales were still outstanding, with more than $1 billion worth of residential property changing hands. It has become commonplace for Houston to sell in that range, but it is still an enormous number for the industry. Houston’s housing market is still as strong as ever and looks to continue through yearend.”

All listing categories combined, Houston’s overall market experienced an increase across the board including sales, available inventory, pending sales – those listings expected to close within the next 30 days – and overall total dollar volume on a year-over-year basis. Months inventory of single-family homes rose slightly from 6.1 months last year to 6.4 months in September 2004.

September (all categories)
All Classes September
2003 September
2004 Percent Change
Total home sales 5,741 5,896 + 2.7 %
Total dollar volume $943,531,813 $1,026,686,640 + 8.8 %
Active listings 38,884 43,122 + 10.9 %
Pending sales 3,606 3,945 + 9.4 %
Months inventory* 6.1 6.4 + 4.4 %

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

Single-family Homes Update
The median price of single-family homes reached $134,900 in September, remaining unchanged from last year, which is the highest median price ever recorded in the month of September in Houston. The median is a typical market price where half of the homes sold for more and half sold for less that that figure.

Houston’s current median price of $134,900 is 29.0 percent less than the national median price, which reached $190,100 in August, according to statistics released by the National Association of REALTORS®. These data continue to show the tremendous value and lower cost of living afforded to Houstonians.

Additionally, total sales for single-family homes increased by 2.9 percent to 4,903 from last year’s 4,764.

Houston Real Estate Milestones in September

Highest number of homes ever sold in the month of September.
Highest median price of single-family homes for the month.
Highest number of available homes for sale since August 1986.


The computerized Multiple Listing Service of the Houston Association of REALTORS includes residential properties and new homes listed by 19,000 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 40,000 properties can 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 20,000-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 membership trade association in Houston, as well as the second largest local association/board of REALTORS® in the United States.