Houston area home sales set new records in May as consumers took advantage of historically low interest rates in snapping up an ever-dwindling supply of properties for sale. What resulted was a nearly 50 percent jump in sales volume compared to the same month last year, when real estate was still in the process of recovering from coronavirus-related lockdown orders. Limited supply, strong buyer demand and increased construction costs all contributed to record high home prices.
According to the latest Houston Association of Realtors (HAR) Market Update, single-family homes sales surged 48.2 percent compared to last May, with 9,702 units sold versus 6,546 a year earlier. That marks the greatest one-month year-over-year sales volume increase of all time and is the market’s twelfth consecutive positive month of sales. On a year-to-date basis, home sales are leading 2020’s record pace by 29.5 percent.
Homes priced from $750,000 and above led the way in May sales volume, shattering all previous measurements with a whopping 291.0 percent year-over-year increase. That was followed by the $500,000 to $750,000 segment, which rocketed 166.0 percent. This unprecedented surge in high-dollar homebuying is responsible for pushing pricing to record-setting levels. The single-family home average price rose 29.7 percent to $387,105 and the median price increased 21.7 percent to $304,000.
Sales of all property types totaled 12,100 – the second highest volume of all time. That is up 55.5 percent from May 2020. Total dollar volume for the month soared 100.5 percent to $4.4 billion.
“We are witnessing the most energized Houston real estate market in history,” said HAR Chairman Richard Miranda with Keller Williams Platinum. “Sellers maintain the upper hand, and buyers are not just meeting their demands. They are exceeding them, as we hear endless accounts of offers coming in that are thousands of dollars above list price. It’s difficult to predict how and when this incredible housing run will end.”
Lease Property UpdateConsumer demand for lease properties waned in May while rent figures rose. Single-family lease homes fell 26.8 percent year-over-year and leases of townhomes and condominiums declined 3.5 percent. The average rent for single-family homes jumped 10.6 percent to a record $2,025 while the average rent for townhomes and condominiums increased 8.5 percent to $1,716.
May Monthly Market ComparisonAs frenzied buying continued to dominate high end housing, and inventory held to its lowest level of all time, the Houston real estate market scored its twelfth consecutive month of positive sales in May.
May sales trends were largely positive. Single-family home sales, total property sales and total dollar volume all rose when compared to May of 2020. Pending sales climbed 12.4 percent. However, total active listings – or the total number of available properties – fell 40.6 percent with sales still dramatically outpacing new listings, which increased just 1.3 percent year-over-year.
Single-family homes inventory was squeezed to a 1.4-months supply in May from 3.3 months a year earlier. Inventory has now held at 1.4-months for three straight months. Housing inventory nationally stands at a 2.4-months supply, according to the National Association of Realtors (NAR).
