Texas housing markets aren’t coming off the burner anytime soon, with the latest Quarterly Housing Report from the Texas Association of Realtors showing the market is only getting hotter.
And this is despite a pullback in the Texas economy, Jim Gaines, chief economist at the Real Estate Center at Texas A&M University, noted.
“Given the recent slowdown in the Texas economy, the performance of the Texas housing market in the third quarter is remarkable,” said Gaines.
“The demand for housing in Texas continues to exceed supply, driving home prices upward. We just haven’t been building homes fast enough, and the rising land and development costs have made it difficult to build new homes at lower price points,” he continued.
According to the report, 91,248 homes were sold in Texas in the third quarter of 2016, which is only a 0.2% rise from the third quarter last year.
The median price for homes in Texas increased in the same timeframe by 7%, rising to $214,000.
While the growth may seem small, given that last year posted record-breaking sales, any increase is still notable.
“Texas home sales in 2016 continue to edge out last year’s record-breaking sales volume, and in many local markets, growth is still very strong,” said Leslie Rouda Smith, chairman of the Texas Association of Realtors.
Housing inventory continued to struggle to grow, with inventory edging upward in the third quarter to 3.9 months. This marked an increase of 0.1 months from the same quarter of the previous year. In addition, active listings rose 4.2 % to 103,109 active listings.
Texas homes spent slightly more time on the market in the third quarter, averaging 53 days, which is one day longer than the same quarter of 2015.
This new report from the Texas Association of Realtors doesn’t confirm that the market is in a bubble, but it doesn’t do much to extinguish the idea.
Following other reports that have highlighted about the Texas housing market, at what point does a booming market become an overheating one? This is definitely not the first report on the state’s booming real estate market.
For the latest report, Smith concluded, “Texas real estate and housing affordability are at the center of the Texas economy and our state’s future growth. In the upcoming session of the Texas Legislature, it’s critical that we continue to take steps to keep homeownership affordable in Texas.”