Demand
Record home prices and rapidly rising mortgage rates continued to discourage buyers. While summer is normally peak season, July’s total housing sales sank according to the Texas Real Estate Research Center’s Data Relevance Program. The state’s sales volume lost over 3,000 deals, falling to a seasonally adjusted rate of 28,121 closed sales. Sales in all major metros declined under falling demand. Austin and Houston’s closed sales took the biggest hits, each dipping almost 16 percent MOM, while DFW and San Antonio each shrank close to 8 percent. While every prospective homebuyer has to confront financial challenges, affordability most adversely impacted first-time buyers, resulting in a significant shrinkage in sales of homes below $300,000.
Texas’ average days on market (DOM) remained low at 34 days, suggesting a persistent imbalance between sellers and buyers’ bargaining power. Homes sold quickest in Austin and Dallas, leaving the market in 22 days, while Houston and San Antonio’s DOM hovered around 30 days. When DOM is differentiated based on the home market, the DOM for existing homes is conspicuously lower than that of new homes. Existing homes are still in a tight housing market.
Categorized by price cohorts, homes priced in the $300K and $400K cohorts sold fastest, typically in 28 days. Meanwhile, homes priced at more than $750K had interestingly shorter listing periods than those priced at less than $300K.
Prices
In July, the Texas’ median home price fell $5,000 to $344,000. Prices dropped in all metros (Table 2). Austin ($510,000) and DFW ($406,000) fell $7,000 and $8,000 in a month, respectively. Meanwhile, Houston ($338,000) dropped $3,000, and San Antonio ($328,000) dropped $4,000. Amid the statewide downturn, Austin prices had the steepest decline, falling $33,000 in three months. Housing prices are under correction, but they remain much elevated from a year ago, accelerating 13.2 percent year over year (YOY).
