HOUSTON – (Realty News Report) – Houston home sales surged to a record high in June as 9,328 single-family dwellings were sold, the Houston Association of Realtors reported.
It was the first time Houston home sales surpassed the 9,000 sales-mark in a single month.
Buyers were motivated by exceptionally low mortgage rates. Freddie Mac reported the average 30-year mortgage rate in this week stood at 3.03 percent, the lowest since Freddie Mac started the surveey in 1971 survey. A year ago, the 30-year rate was 3.75 percent.
The average 15-year mortgage fell to 2.51 percent, Freddie Mac reported.
However, the residential markets have been struggling in some places in the face of the headwinds of the coronavirus pandemic. Significant job losses have been reported in the Houston economy, which has suffered from pandemic-related layoffs and business failures. In addition, declining energy prices and oil drilling drained growth from the economy in recent months.
Houston’s economic decline and pandemic concerns resulted in a huge 20 percent decline in home sales in May.
The June sales surge represented a significant turnaround from the slow sales in May.
The Realtors association reported the 9,328 homes sold in June represented a 15.7 percent increase over the 8,063 homes sold in June of last year.
“Coronavirus has driven the Houston housing market into uncharted territory, however, we do know for certain that consumers have shown unwavering interest in real estate since the pandemic began,” said HAR Chairman John Nugent with RE/MAX Space Center. “HAR’s early introduction of virtual open houses and virtual showings has enabled consumers to forge ahead with house-hunting plans without compromising health and safety, and historically low interest rates have remained a strong incentive to buy.”
The Houston home sales surge in June has allowed to catch-up following the decline. On a year-to-date basis, the Houston home sales now match last year’s record pace. The single-family home median price rose 3.6 percent to an all-time high of $262,000
However, the CoreLogic firm, in a national forecast, predicted that home prices are headed for a decline due to elevated unemployment rates. This prediction is exacerbated by the recent spike in COVID-19 cases across the country.
“Pending sales and home-purchase loan applications are higher than in June of last year and reflect the buying activity of millennials,” said Frank Nothaft, chief economist at CoreLogic. “By the end of summer, buying will slacken and we expect home prices will show declines in metro areas that have been especially hard hit by the recession.”
The average home sale price in Houston was $319,881 in June, down 3.2 percent from $321,884 in June of 2019, the Realtors reported.
In Houston, the inventory of for-sale homes remains lean ( a 3.2-month supply) and pending sales point to a strong July, the HAR reported.
July 9, 2020 Realty News Report Copyright 2020
Photo Caption: Houston home sales surge despite the coronavirus concerns. Photo credit: Ralph Bivins of Realty News Report.