13 Mar After the Storm: Texas Housing’s Recovery from Harvey
When Hurricane Harvey struck Texas last summer, many housing experts worried what the megastorm’s effect on the market would be. Turns out, their fears of a wounded market were needless.
"Despite the devastation of Hurricane Harvey,” said Kaki Lybbert, Chairman of the Texas Association of Realtors, “the Texas housing market had a very strong fourth quarter, helping solidify 2017 as another record-breaking year in Texas real estate.”
According to the 2017 Texas Real Estate Year in Review report from the Texas Association of Realtors, home sales volume and home prices in the Lone Star State reached all-time highs for the third year in a row last year. Overall, Texas home sales jumped 4 percent, with 336,502 homes sold statewide. Home prices also experienced steady increases in 2017, with the median sales price increasing 6.7 percent from the year prior, to $223,990.
The average sale spent just shy of two months on the market last year. According to the report, Texas overall had about three months of inventory in rotation by the end of Q4. In Q4 itself, that was a 0.1 percent dip. A stable inventory should be about six months. Active listings increased 5.5 percent from 2016 to 2017.
The strongest growth in median prices occurred in the Dallas-Fort Worth metroplex, where a third of houses for sale last year closed between $200,000 and $300,000. About two-thirds of Texas houses were occupied by the owner at the end of the year.
Lybbert attributed the strong growth to the sizable influx of residents and job growth across the state last year.
“With more than half a million people moving to the Lone Star State each year, we anticipate the Texas housing market will remain a hotbed for activity," she said.
Jim Gaines, Chief Economist with the Real Estate Center at Texas A&M University, said the year ahead should stay strong.
"Across the state, we are projecting sales activity to be even more robust in 2018,” Gaines said. “One of the big drivers will be from first-time homebuyers finding opportunity in the market with more builders focusing on the entry-level price point and lenders relaxing the requirements for first-time homebuyers. Additionally, the likelihood of more volatile interest rates in 2018 will influence homebuyers to buy now rather than later."
While Lybbert said she was happy with the strength of Texas’ 2017 market, she also echoed what many housing insiders say about continuously rising housing prices nationally—namely, that affordability needs to be guarded.
"The Texas housing market remains in such high demand that we continue to see low levels of housing inventory and strong increases in home prices,” Lybbert said. “While that continues to be good news for property owners, Texas Realtors will also continue to advocate for affordable options for all Texans."