HOUSTON – (Realty News Report) – Houston’s single-family home sales declined 30 percent in January, compared to January of 2022, as economic conditions squeezed the realty markets.
Mortgage rates are over 6 percent, twice as high as they were a year ago. The difference between a 3 percent and 6 percent mortgage rate can add more than $700 per month to the cost of a typical home loan. In addition, the onslaught of inflation has tightened household budgets. So, affordability and price-tag shock has smushed homebuyers over the last year.
In the Houston metro area, with 4,549 single-family were sold last month, compared to 6,492 home sales in January 2022, according to the Houston Association of Realtors.
Last year began with strong home sales and rising prices. But when the Federal Reserve belatedly kicked in with massive hikes, the realty market was damaged.
The Fed toned it down last week with a 25 basis point increase, setting aside the heavy sledge hammer it had been using to maul the economy. If the Fed backs off, the housing market should improve later this year.
“Certainly consumers want assurances that inflation is subsiding, so if mortgage rates stabilize and homes continue hitting the market at more affordable price points, we could expect an upswing in sales later this year,” said Cathy Treviño, HAR Chair.
Home prices continue to rise in early 2023, but at a slower pace.
The average price increased 1.5 percent to $381,983 in January. The median price rose just 1.6 percent to $315,000, HAR reported.
Last year home prices increased significantly across the country. In Houston, the annual median single-family home price was $338,295 in 2022, up 12.8 percent from $300,000 in 2021. Median is the midpoint where half the homes sold for more and half for less.
Feb. 8, 2023. Realty News Report Copyright 2023
Photo by Ralph Bivins, Realty News Report Copyright 2023..
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File: Houston Home Sales Fall 30 Percent
File: HAR. Houston Home Sales Fall 30 Percent