HOUSTON — Homebuyers and renters in the Houston area are currently experiencing a favorable market, as new reports indicate a significant increase in housing inventory and a decrease in prices.
The Houston Association of Realtors (HAR) has revealed that the housing inventory reached its highest level in nearly 13 years as of May, dramatically changing the landscape for prospective buyers and renters alike.
Homebuyers are benefiting from reduced prices alongside lower mortgage rates, leading to a decrease in average home sales prices.
In May, the average sales price of homes fell by 0.7% to $438,230, while the median price dropped 1.2% to $339,425.
These market shifts are also positively affecting renters, with more options available and prices becoming slightly more favorable.
As HAR Chair Shae Cottar with LPT Realty noted, this newfound confidence has encouraged potential homebuyers to actively engage in the market once again.
In the upcoming weeks, HAR plans to release its “May 2025 Rental Home Update” on June 18, which is expected to provide further insights into these trends.
Key highlights from HAR’s report on the Houston real estate market in May include a record of 37,455 active listings of single-family homes, reflecting a 35% increase year-over-year.
This surge marks the highest volume of active listings since September 2007, signaling a robust shift toward a buyer’s market.
Single-family home sales experienced a notable increase of 6.8% compared to the previous year, with 9,058 homes sold in May versus 8,483 a year prior.
The increase in active listings coincided with a rise in Days on Market (DOM) for single-family homes, which lengthened from 46 to 50 days in May.
Additionally, the single-family median price decreased by 1.2% to $339,425, while the average price showed a minor decrease of 0.7% to $438,230.
The market for townhomes and condominiums, however, has not shared in these gains, with sales dropping 12.9% compared to the same month last year.
The median price in this segment declined by 8.3% to $221,500, and the average price experienced a 5.5% drop, reaching $265,903.
Overall, total property sales in the region increased by 4.6%, with 10,565 units sold in May, alongside a rise in total dollar volume which rose 5.6% to $4.5 billion.
Among existing homes, sales also saw a modest rise of 5.1% with 6,370 closings registered compared to 6,059 in the previous year.
The average price for these homes remained statistically flat at $458,299, while the median sales price held stable at $345,000.
The ongoing trend shows that Houston-area homebuyers are actively seizing the chance presented by the growth in inventory and easing prices, signaling a significant shift towards a buyer’s market.
This is reflected in the strong year-to-date sales numbers which recorded the largest increase in May.
Cottar articulates that this momentum among buyers is indicative of their eagerness to leverage current market conditions, creating a shift in seller perspectives.
As we look ahead to the summer months, it is expected that sales will continue to climb as the market remains favorable for buyers.
The increase in active listings for single-family homes to 37,455 units available in May represents a significant opportunity for buyers, rising 35% from the same time last year.
With the inventory level reaching heights not seen since September 2007, home prices and sales conditions are becoming increasingly favorable for buyers.
Meanwhile, the townhome and condominium market in Houston continues to reflect a more challenging scenario for sellers, with the supply of listings showing a considerable increase.
As of May, townhome and condominium listings rose to 3,311 units, leading to a supply of 7.8 months, surpassing the previous year’s 4.6 months.
This transition creates a favorable climate for homebuyers looking into this segment of the market as well.
Particularly noteworthy is the performance of affordable housing categories, which demonstrated robust growth in sales.
It was reported that the $1 – $99,999 price segment saw a remarkable increase of 23.8% in sales, while other affordable ranges similarly showed significant growth, indicating that the demand remains strong even in the lower price brackets.
In light of these shifts, homebuyers are finding newfound opportunities as lowered mortgage rates provide additional savings in their purchasing decisions.
Freddie Mac’s Primary Mortgage Market Survey confirms that these rate changes are benefiting many, making the current market particularly attractive for those entering or continuing within the housing landscape.
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