Texas home sales and prices accelerated in the first quarter as continued job growth and shrinking inventory improved residents’ attitude toward real estate.
Single-family home sales in Texas expanded 12% in the first quarter to 45,502 sales from 40,627 in the year-ago quarter. Median prices increased about 3% to $147,100, according to the Texas Association of Realtors’ Texas Quarterly Housing Report.
“Several factors are driving the strong performance of the first quarter, including continued job growth in Texas and some increased access to credit for homebuyers,” Jim Gaines, an economist with the Real Estate Center at Texas A&M University, said.
Texas’ unemployment rate is 7%, below the national average of 8.2%, according to the U.S. Bureau of Labor Statistics.
“Most of all, we’re starting to see a shift in Texans’ attitudes toward real estate,” Gaines continued. “Essentially, buyers and sellers have higher expectations for the market, so they’re beginning to take action and we’re starting to see the impacts.”
The inventory of homes for sale in Texas, which has fallen for six consecutive months, sits at six months, sliding 23% from year-ago levels of 7.6 months. The Real Estate Center cites 6.5 months of inventory as a balanced market.
“A decrease of more than 20% in the inventory of homes compared to the same quarter last year is significant and may be an indication of price increases in the future,” Gaines said.
He attributed the shrinking inventory to homeowners choosing to wait for prices to improve before selling their homes. “In addition, the slower processing of foreclosures and fewer distressed properties may reduce the number of listings,” he added.