Has the Housing Frenzy Peaked?

The Texas housing market has cooled slightly, with home sales down 3.5% in the third quarter compared to last fall’s extraordinary market. The total number of homes sold dipped to 115,272.

“Although we’re seeing a slight decline in homes sold from the same period a year ago, it’s important to remember we’re comparing to 2020’s record-breaking numbers,” said Texas REALTORS® Chairman Marvin Jolly. “Across the state, we’re still experiencing strong demand for housing, and buyers are moving to Texas from all over the nation.”

Texas REALTORS® has released the 2021-Q3 Texas Quarterly Housing Report. The median sales price of a Texas home leapt 16.9% to $310,000 since last fall. Approximately 30% of homes were priced between $200,000 and $299,999.

The housing frenzy due to the pandemic has possibly peaked, says Luis Torres, research economist with the Texas Real Estate Research Center at Texas A&M University. “Home prices and homes sales are beginning to slow. In addition, months of inventory and home listings have reached a trough and are now increasing. Still, for the remainder of 2021, the housing market will be characterized by strong demand with low inventories accompanied by strong price growth, albeit at a slower rate.”

Housing inventory fell to 1.6 months in the third quarter, down 2.3 months from the third quarter of 2020. The research center cites 6 to 6.5 months as a balanced market.

Source: Texas REALTORS®