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The Houston real estate market performed well in April, but for the first time this year, sales of single-family homes failed to beat last year’s historic pace as record-high prices, rising interest rates and limited inventory weighed on homebuyers during the traditionally busy spring homebuying season. Townhome, condo, and high-rise sales performed somewhat better.

 “Contrary to what some people think, we do actually have new listings hitting the market, but they are selling exceptionally quickly and at some of the highest prices of all time as buyers and investors make cash offers well above asking price to beat back their competition,” said HAR Chair Jennifer Wauhob with Better Homes and Gardens Real Estate Gary Greene. “Consumers have grown increasingly weary of the buying frenzy, and many are considering postponing their purchasing plans because pricing and interest rates have exceeded their reach. Unfortunately, we don’t anticipate conditions to improve anytime soon.” 

Sales may be leveling out. In the 12 months ending April ’22, Houston area realtors closed on 134,183 homes (single-family, townhomes, condos, duplexes). That compares to 134,157 closing in the 12 months ending March ’22.

Days on Market, or the actual time it took to sell a home, fell from 40 to 33 days. Inventory was at 1.4 months, up marginally from 1.3 months in from March. The current national inventory stands at 2.0 months, as reported by the National Association of Realtors.
By segment, year-over-year April single-family sales performed as follows:

•    $1 - $99,999: decreased 6.8 percent
•    $100,000 - $149,999: decreased 15.5 percent
•    $150,000 - $249,999: decreased 44.7 percent
•    $250,000 - $499,999: increased 13.5 percent
•    $500,000 - $999,999: increased 45.0 percent
•    $1M and above: increased 24.9 percent

Houston’s lease market registered a mixed performance in April. Single-family rental were up 17.2 percent compared to last year as consumers postponed homebuying plans and chose to rent instead. However, leases of townhomes and condominiums fell 3.0 percent. The average single-family rent rose 10.2 percent to $2,164 while the average rent for townhomes and condominiums increased 8.4 percent to $1,831.  

Days on Market, or the actual time it took to sell a home, fell from 46 to 38 days. Inventory was at 1.3 months, no change from March ’21. That’s marginally above Houston’s lowest inventory level of all time—1.2 months—recorded in February ’22. The current national inventory stands at 1.7 months, as reported by the National Association of Realtors.

By segment, year-over-year March single-family sales performed as follows:

•    $1 - $99,999: decreased 32.9 percent
•    $100,000 - $149,999: decreased 31.3 percent
•    $150,000 - $249,999: decreased 36.9 percent
•    $250,000 - $499,999: increased 24.0 percent
•    $500,000 - $999,999: increased 36.1 percent
•    $1M and above: increased 16.0 percent

The lease market enjoyed a positive March as well, still benefitting from consumers who have postponed homebuying plans until the market yields a broader and more affordable supply of housing. Single-family rental homes rose 18.3 percent year-over-year. Leases of townhomes and condominiums were unchanged. The average single-family rent rose 6.7 percent to $2,075, while the average rent for townhomes and condominiums increased 7.6 percent to $1,852.  
 

Prepared by Greater Houston Partnership Research

Patrick Jankowski, CERP
Senior Vice President, Research
713-844-3616
pjankowski@houston.org