A frenetic market for buying homes has also led to an increasingly competitive rental market.
The average sale price of a single-family home in Houston crept over $400,000 in March for the first time ever, according to a new report from the Houston Association of Realtors (HAR).
The new average—$410,923 to be exact—was an 11.4 percent increase over February, which was also a record-setting month, with an average sale price of $395,871.
“We are experiencing unprecedented market conditions in Houston with a frenetic pace of homebuying despite limited inventory, rising prices and steadily climbing interest rates,” said HAR chair Jennifer Wauhob, of Better Homes and Gardens Real Estate Gary Greene, in the report.
Nearly every real estate metric HAR reported demonstrated an increasingly competitive market, a reflection of housing trends in cities across the county right now—especially places that have been popular destinations for people who relocated during the pandemic.
In March 2022 the number of sales for single-family homes in Houston increased 4.1 percent, year-over-year, and the total dollar volume of sales rose 15.7 percent while the average number of days on the market dropped from 46 to 38, according to the HAR report. The only measure that stayed flat was the number of months of inventory, which stands at 1.3, the same as March 2021—it was only 1.2 months in February.
There are also just fewer less-expensive properties to buy, according to HAR. The sale of homes priced between $500,000 and $1 million rose 36.1 percent in March over the same period in 2021, while the sale of homes that cost between $150,000 and $249,000 dropped by nearly the same amount—36.9 percent. Those costing between $250,000 and $499,000 increased 24%, while those costing between $100,000 and $149,999 dropped by 31.3 percent.
The sale of homes costing over $1 million increased by 16 percent over the same period last year.
Surging home prices have led to a much tighter rental market, too, as people who can’t currently afford to buy are choosing to lease instead, HAR reported. Single-family rentals increased 18.3 percent over March 2021, with the average monthly rent up 6.7 percent—it now stands at $2,075.