Houston’s housing market reached a tipping point in July, posting its first sales decline in six months, according to the latest monthly report prepared by the Houston Association of Realtors.
The report found that a total of 7,204 homes sold in July compared to 7,898 a year earlier, representing a drop of 8.8%, the first decline since January.
This drop though is correlated to a monthly analysis. Looking at the data on a yearly basis paints a better picture and instead shows that home sales are up about 1% compared to this point in 2015.
Although the news is initially alarming, HAR Chairman Mario Arriaga with First Group, said, "We never like to see a decline in home sales, but it’s helpful to remember that our comparisons each month are to a record year in 2015."
And the decline spread across the entire marketing, impacting homes on the highest and lowest ends of the pricing spectrum.
"July was the first time in several months when even mid-range housing saw declines. It’s hard to identify a single cause for the drop in sales, whether it’s a possible trickle-down effect of falling oil prices or prospective buyers holding out, but Houston’s housing market is still healthy overall, and HAR will continue to monitor conditions as we transition into the fall months,” said Arriaga.
The latest Credit Suisse Monthly Survey of Real Estate Agents reported that in Houston specifically, which is the No. 1 city in terms of single-family building permits, real estate agents said that they are taking a beating from oil prices dropping.
Agents in the area continued to cite the negative impacts to housing demand from lower oil prices, including layoffs and much needed job growth.
There is one positive area for Houston in the report. The city posted that inventory levels continue to outpace last year, rising from a 3.5-months supply to 4.0 months. This marks the largest supply of homes since November 2012 when it stood at 4.1 months.
Meanwhile the HAR report found that the single-family home median price—the figure at which half of the homes sold for more and half sold for less—rose 4.1% to $230,000. This is the highest median price ever for July and the second highest of all time. The highest median ever was $233,000, reached in June of this year.