All Forum Posts by: Jhoana Olarte

Robust supply fuels strong leasing activity in the Greater Houston area

HOUSTON — (February 21, 2024) — The new year started with solid demand for single-family rental homes as well as townhomes and condominiums. Many would-be homebuyers are turning to Houston’s rental market due to ongoing concerns about elevated mortgage rates. According to the Houston Association of Realtors’ January 2024 Rental Market Update, single-family home rentals were up fractionally year-over-year, with the average rent up 2.5 percent to $2,225. A total of 2,960 leases were signed versus 2,945 in January 2023. New listings of single-family rentals rose 5.2 percent, adding to a robust supply of units. Days on Market, or the actual time it took to lease a home, was flat at 41 days. “We are seeing a steady demand in Houston’s rental market as some prospective homebuyers are still choosing to hold off on making a move until mortgage rates come down,” said HAR Chair Thomas Mouton with Century 21 Exclusive. “For now, there appears to be an adequate supply of rental properties throughout the Houston area.”

Consumers showed more interest in townhomes and condominiums for rent in January. Leases of those properties increased 10.6 percent on the year, with 575 units leased compared to 520 last January. Rents rose a fractional 0.7 percent to $1,907. New listings were up 19.4 percent. Days on Market increased from 44 to 46 days. HAR’s new Rental Market Update is distributed the third Wednesday of each month, one week after the release of the monthly Sales Market Update. An archive of all these reports is available in the HAR Online Newsroom.

• 2023 marked the second consecutive year of declining home sales with 83,854 single-family homes sold versus 95,302 in 2022 – a decline of 12.0 percent; .
• Total dollar volume for full-year 2023 fell 12.6 percent to $40B;
• December single-family home sales fell 6.2 percent year-over-year with 6,103 units sold;
• Total December property sales declined 4.9 percent to 7,395 units;
• Total dollar volume for December fell 3.7 percent to $2.9B;
• At $330,000, the single-family home median price was unchanged;
• The single-family home average price was also unchanged at $407,817;
• Single-family homes months of inventory expanded to a 3.3-months supply;
• The townhome/condominium market experienced declining sales throughout 2023, and in December, volume fell 7.0 percent with the average price up 6.7 percent to $258,137 and the median price down 9.3 percent to $235,000;
• Townhome/condominium inventory grew from a 2.0-months supply to 3.5 months.

SOURCE HAR

• Single-family home sales were down 3.8 percent year-over-year, the 17th consecutive month of slowing sales volume, however there continued to be signs of overall improvement to the local housing market;
• The 3.8 percent decline is the smallest since the market registered a 0.8 percent drop in May 2022;
• Compared to August 2019, before the pandemic, sales were down 8.0 percent, and compared to August 2018, five years back, they were down 4.5 percent.
• Days on Market (DOM) for single-family homes rose from 32 to 42 days;
• Total property sales fell 4.3 percent with 9,780 units sold;
• Total dollar volume dropped 2.0 percent to $3.8 billion;
• The single-family median price was statistically unchanged at $339,000;
• The single-family average price rose 2.5 percent to $420,124;
• Single-family home months of inventory registered a 3.3-months supply, up from 2.4 months a year earlier – the biggest supply in three years;
• Townhome/condominium sales experienced their 15h straight monthly decline, falling 19.0 percent, with the median price up 3.2 percent to $225,000 and the average price up 2.7 percent to $260,909;
• Compared to pre-pandemic 2019, townhome and condominium sales were down 13.0 percent.

Demand for rental housing across Greater Houston was strong in June, drawing steady consumer interest as uncertainty about mortgage rates and inflation kept home sales below seasonal norms. Rentals of single-family homes as well as townhomes and condominiums drew equal interest throughout the month. According to the Houston Association of Realtors’ (HAR’s) June 2023 Rental Market Update, leases of single-family homes jumped 16.0 percent year-over-year with the average lease price climbing 2.9 percent to $2,344 – a record high. A total of 4,211 leases were signed compared to 3,631 in June 2022. New listings of single-family rentals rose 18.4 percent in June, providing a sufficient supply of homes to meet the steady demand. Days on Market, or the actual number of days it took to lease a home, rose from 22 to 31 days. “The Houston rental market remains strong, and that’s a good place to be while consumers who really want to buy a home wait for more favorable economic conditions to do so,” said HAR Chair Cathy Treviño with Side, Inc. “For a while, single-family rentals were leading the way each month, however, we are now seeing across-the-board interest in all rental property types.”

The townhome/condominium rental market was in positive territory in June. Leases of those properties climbed 15.3 percent with 767 units leased compared to 665 last year. The average lease price rose 7.7 percent to $2,053 – also a record high. New listings increased 6.4 percent and Days on Market went from 29 to 34 days. Pre-pandemic Perspective: Compared to the last June before the pandemic, single-family home rentals are up 20.2 percent. In June 2019, leases were signed for 3,503 single-family homes. The average rent is currently 21.7 percent higher than it was back then – $1,926. Townhome/condominium rentals totaled 729 in June 2019. That is 5.2 percent below the June 2023 volume. The average townhome/condo rent is currently 27.9 percent above its June 2019 price of $1,605. 

Source HAR.com

Houston Real Estate Highlights in June

• Single-family home sales were down 12.8 percent year-over-year, the 15th consecutive month of slowing sales volume, however there were signs of overall improvement to the local housing market;
• Compared to pre-pandemic 2019, single-family home sales were up 3.9 percent and were up 2.3 percent versus the volume five years ago, in June 2018;
• The luxury segment, consisting of homes priced from $1M and above, saw its first gains in months, climbing 5.9 percent year-over-year in June;
• Days on Market (DOM) for single-family homes rose from 28 to 45 days;
• Total property sales fell 13.7 percent with 10,382 units sold;
• Total dollar volume dropped 13.4 percent to $4.2 billion;
• The single-family median price dropped 2.5 percent to $345,000;
• The single-family average price fell 0.5 percent to $431,092;
• Single-family home months of inventory registered a 3.1-months supply, up from 1.9 months a year earlier – the biggest supply in three years;
• Townhome/condominium sales experienced their 13th straight monthly decline, falling 17.5 percent, with the median price down 2.5 percent to $217,000 and the average price down 2.7 percent to $252,845;
• Compared to pre-pandemic 2019, townhome and condominium sales were up 5.1 percent.

Source HAR

• Single-family home sales fell 22.8 percent year-over-year, the seventh consecutive decline of 2022 as the market returns to pre-pandemic levels;
• All housing segments experienced negative sales in October. The smallest decline in sales Days on Market (DOM) for single-family homes grew from 32 to 43 days;
• Total property sales were down 22.7 percent with 8,223 units sold;
• Total dollar volume declined 18.4 percent to a little over $3 billion;
• The single-family average price rose 7.2 percent to $403,712;
• The single-family median price increased 8.4 percent to $330,500;
• Single-family home months of inventory registered a 2.8-months supply, up from 1.8 months a year earlier. That is the greatest inventory level since July of 2020;
• Townhome/condominium sales experienced their fifth consecutive monthly decline, falling 19.4 percent, with the average price up 9.3 percent to $269,936 and the median price up 3.9 percent to $226,500.

Houston Real Estate Highlights in September

• Single-family home sales fell 17.0 percent year-over-year, the sixth consecutive decline of 2022 as the market continues toward a more normalized, pre-pandemic pace;
• Despite the overall sales volume decline, the high end of the market flourished with the $500,000 to $1M housing segment establishing itself as the top-performing segment in September, up 12.6 percent year-over-year;
• Days on Market (DOM) for single-family homes grew from 29 to 37 days;
• Total property sales were down 17.0 percent with 9,387 units sold;
• Total dollar volume was off 8.5 percent at $3.7 billion;
• The single-family average price rose 11.6 percent to $414,776;
• The single-family median price increased 14.7 percent to $343,950;
• Single-family home months of inventory registered a 2.7-months supply, up from 1.7 months a year earlier. That is the greatest inventory level since July of 2020;
• Townhome/condominium sales experienced their fourth consecutive monthly decline, falling 17.6 percent, with the average price up 7.5 percent to $257,781 and the median price up 4.8 percent to $220,000.

HAR Source

• Single-family home sales fell 16.9 percent year-over-year, the fifth decline of 2022 as the market continues toward a more normalized, pre-pandemic pace;
• Days on Market (DOM) for single-family homes ticked up from 27 to 31 days;
• The ‘Close to Original List Price Ratio’ for single-family homes has now remained below 100 percent for two consecutive months, meaning fewer buyers paid above list price for homes on the market;
• Total property sales were down 15.8 percent with 10,157 units sold;
• Total dollar volume was off 9.4 percent at $3.9 billion;
• The single-family average price rose 8.7 percent to $411,671;
• The single-family median price increased 10.8 percent to $341,950;
• Single-family home months of inventory registered a 2.5-months supply, up from 1.7 months a year earlier. That is the greatest inventory level since August of 2020;
• Townhome/condominium sales experienced their third consecutive monthly decline, falling 14.9 percent, with the average price up 7.2 percent to $254,383 and the median price up 8.1 percent to $217,000.

• Single-family home sales fell 17.1 year-over-year, their fourth and biggest decline of 2022 as the market continues on the path toward a more normalized, pre-pandemic pace;
• Days on Market (DOM) for single-family homes was flat at 26;
• The ‘Close to Original List Price Ratio’ for single-family homes fell below 100 percent for the first time since April 2022, meaning that most buyers did not pay above list price for homes on the market;
• Total property sales were down 17.4 percent with 10,180 units sold;
• Total dollar volume was off 9.0 percent at $4.1 billion;
• The single-family average price rose 9.9 percent to $426,494;
• The single-family median price increased 12.7 percent to $348,740;
• Single-family home months of inventory registered a 2.5-months supply, up from 1.7 months a year earlier. That is the greatest inventory level since August of 2020;
• Townhome/condominium sales experienced their second consecutive monthly decline, falling 21.5 percent, with the average price up 5.0 percent to $257,834 and the median price up 9.7 percent to $220,000.

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