HOUSTON – (Realty News Report) – Veteran Houston Realtor Shad Bogany was a guest on THE RALPH BIVINS PROJECT, a new podcast produced by Realty News Report. Here is an excerpt from his appearance.
To Listen to Shad Bogany’s conversation on THE RALPH BIVINS PROJECT podcast CLICK HERE.
Ralph Bivins: There’s a crazy trend going on in the Houston real estate market right now, one like I have never seen before. The housing market is doing crazy things, setting records for number of homes sold. Today, we are speaking with Shad Bogany, a licensed real estate agent with Better Homes & Gardens Real Estate Gary Greene. He was named the 2020 Texas Realtor of the Year by the Texas Realtors association. He has also been chairman of the board of the Houston Board of Realtors.
Shad has been host since 1990 of “Real Estate Corner,” which comes on KWWJ 1360 AM at 6:15 p.m. on Tuesdays. I’ve been on his show on many occasions and now it’s payback time. Shad, what’s the state of affairs of the Houston real estate market?
Shad Bogany: I thank you, Ralph, for having me on your program. I think you were absolutely right when you started out by saying, “I have never seen anything like this.” I’ve been in real estate almost 40 years and I agree with you. I have never seen anything like this. 2020 was a record sales year, in spite of the pandemic. For a couple of months, nothing happened at all. Then, suddenly, we finished with a record sales year, and it has continued into 2021. The real key to it is that we have the equivalent of a perfect storm. Low interest rates, low inventory that is boosting home prices. We don’t have much of an inventory; it’s strictly supply and demand. I can’t tell you how many people have asked me if we are on the edge of a housing bubble. But it’s not a bubble, it’s economic. I believe builders have something to do with this, too. They have not been producing the product. Buyers that might normally have bought new homes are starting to buy resale homes. This puts a lot of pressure on the resale market. When we take buyers out to the marketplace, they talk to builders who say to them: “You can pick out a lot and you can pick out a style of home. But we don’t know how much the house will end up costing you. If you pick out a lot, at least you will get on the list to have a house built.” I have never seen anything like that.
Buyers are looking for resale homes because they don’t like this uncertainty. We lost a lot of new homes in the Hurricane Harvey flooding. Then, the investors moved in and bought the homes. Instead of putting them back on the market and rehabilitating them, they rehabilitated them and rented them out. Some of these homes are coming on the market right now, but buyers are saying, “No, I don’t want to look at a house that was flooded.”
Yes, it has been a perfect storm of everything coming together. That has been part of the frenzy in the real estate market.
Ralph Bivins: The inventory is super tight.
Shad Bogany: We have about six weeks of inventory in Houston. But I see this as the cup being half-full. Austin may have a week of inventory; Dallas, maybe two weeks. We are doing better than some other big cities in the state. I was up in Tyler last week speaking. The Greater Tyler Association is having the same situation that we are having here. Same thing for El Paso, the Panhandle, down in the Valley, it is the same issue, and it’s a statewide phenomenon. When you talk to people in other states, it is the same. They do not have enough houses to satisfy the demand.
Ralph Bivins: And the prices are going up – and builders are saying that the price of lumber has increased 300% over the past year. You wonder how they can build anything affordable.
Shad Bogany: I had a builder the other day, I won’t name the name. He was selling a property, and it didn’t appraise for what the buyer was going to pay. The builder sent out 2 appraisers and it still didn’t appraise. So, the builder is sending out a third appraiser. But the builder told the buyer that if the house doesn’t appraise, the builder still expects the buyer to purchase the house, and if he doesn’t, the builder will put the house back on the market and work with another buyer.
Another builder I know was working with a sales counselor. He said if the home doesn’t sell, he’s going to take the home away from that counselor and work with someone else in that sales office. The builder says the counselor should have made sure the potential buyer would be able to purchase the home. There’s a lot of pressure on the market now. I listed a townhouse in Bellaire last Saturday. The first buyer made an offer that was above the listing price, and it sold in a couple of hours. I figured it would be on the market for about 30 days, but it sold immediately.
As I talk to other Realtors, we say we wish the world would go back to the way it used to be.
Ralph Bivins: I’ve seen some interesting reports. On a national basis, Redfin that said 50 percent of the houses for sale get multiple offers.
Shad Bogany: I’m going to give the people listening to your podcast a suggestion. If a house has been on the market more than 30 days, you might have a lot more opportunities to buy it or discount it. But this raises the possibility of two issues. One, the house may be way overpriced, or, two, there are condition issues. If it’s one of these, it’s going to be on the market for a longer time. Still, these are the ones that you might get a better deal with.
June 9, 2021 Copyright Realty News Report 2021
For more about Texas real estate, check out the book Houston 2020: America’s Boom Town – An Extreme Close Up by Ralph Bivins. Available on Amazon http://tiny.cc/4a2g6y