Houston – Best Homebuying Opportunity is Now.

Who would have known?  Immediately following the buying flurry before the April 30^th deadline, interest rates dropped dramatically in May, giving home buyers that were too late for the tax credit thousands of saved dollars over the life of a loan and dwarfing the tax credit incentive.  The Houston real estate market now has the best home buying opportunity not only due to lower interest rates but also, as you can see in the table below, more homes available from which to choose.  The 17% higher inventory is also a motivator for sellers’ to become more competitive in their asking price. 

Many economists agree that current positive economic indicators may cause the Fed to raise interest rates in the not too distant future.  Clearly, there is a window of opportunity in the market that savvy home buyers will capitalize on before it is too late.

Prudential Gary Greene, Realtors® #1 in Houston in

1. Total number of listings – 47.5% more listings than the next highest broker!
2. Total number of listings sold in Houston
3. Total number of buyer representation sides and
4. Total number of homes sold year-to-date over any other broker.

2010 Good News on the Houston Homefront

With less than one month to go before the 2010 Homebuyers’ Tax Credit expires on April 30* –there are encouraging economic signs on the Houston home front. Buying a home would be a good investment. Why?

1.       Houston population growth in 2009 and

2.     Unemployment rates are declining and

3.     Home sales in Houston [see chart below] show value retention and ample supply.

Houston Population Growth:

Houston and Dallas–Fort Worth received the largest influx of residents in the country in 2009, according to the U.S. Census Bureau.

Houston had the second-highest population growth last year, with 140,784 people pouring into the metro area, a 2.5 percent increase that pushed the region’s total population to 5.86 million.  Dallas – Fort Worth [two large metros combined] have 6.45 million people as of July 1, 2009 and added 146,530 people. It marked a 2.3 percent increase from 2008.

Houston and Dallas-Fort Worth grew in population in 2009 more than any other region in the nation. Population growth plays a large factor in homes sales and home value retention.

Houston has the sixth-highest population in the United States, according to the U.S. Census Bureau.

Houston Employment and Unemployment:

The Houston-Sugar Land-Baytown Metropolitan Statistical Area gained 10,300 jobs from January to February, according to estimates released today by the Texas Workforce Commission. That’s the largest one-month gain since November ’08.

Unemployment receded from 8.8 percent in January to 8.5 percent in February—not a statistically significant movement, but encouraging nonetheless. Unemployment here remained well below the 10.4 percent national rate. (Rates are not seasonally adjusted.)

The number of initial unemployment insurance claims in the 13-county Gulf Coast Workforce Development Area in February was 17 percent less than in February ’09, Workforce Solutions reports. While we’ve seen month-to-month ups and downs, the moving three-month average for initial claims has declined every month since May ’09, and now stands 19 percent below that peak—definitely a movement in the right direction.

Employment is the single most important factor to rising home sales and we see Houston getter stronger as we move through 2010.

Houston compared to other Texas Cities:

Houston experienced more home sales than any other city in Texas including Dallas-Fort Worth combined, Houston experienced 370 more sales than Dallas-Fort Worth. The chart below gives a year-over-year comparison of Texas cities. Houston has a balanced supply of homes on the market, value retention and sales have been trending toward positive territory since February 2009.

Here is how select Texas cities fared in February (data current as of March 25, 2010):

 Summary:

These encouraging economic indicators, along with the 2010 Homebuyers Tax Credit and favorable interest rates make the next 30 days a prime time to invest in a home in the Houston Metropolitan area. 
*2010 Homebuyers Tax Credit – home buyers must have a binding written contract in place by April 30, 2010 with a closing date no later than June 30, 2010.- go to http://www.realtor.org/home_buyers_and_sellers/extended_home_buyer_tax_credit_how_to for details], 

First-quarter real estate sales indicate Houston has pulled out of a negative sales position and displays the beginning of very positive trends. The latest market metrics correlate very closely with news from the Texas Workforce Commission that Houston-area employers added 10,300 jobs from January to February, an increase of 2,000 real job gains than is atypical for the season.  Employment is the single largest driver of home sales.

Last year in February 2009, Houston experienced a 24% decline in year-to-date sales over 2008.  Every month following February, sales declines began to decline and the year ended with 7% fewer home sales than 2008. 

1. First Quarter 2010 sales are equal to those found in First Quarter 2009 however,
2. Dollar volume sales are up by 13% for a total of $2,183,412,127. 
3. The average sales price is up 13% at $204,191 and the median sales price is up 8% at $149,900. 
4. The average price per square foot is up 10% and now stands at $87. 
5. Homes on the market are up by 3% with 28,793 listings, certainly not a supply that would impact home values.  The best news of all is that
6. Days-on-Market, the average number of days it takes to sell a Houston home is down by 16%. Days-on-Market are 81.

Previously, we mentioned the rise in upscale homes as a rationale for a rise in average and median price in the overall Houston market during the First Quarter.  These were attributable to only 23% of all sales in Houston.

What home price classes were the hottest selling in Houston through First Quarter?  

The following table indicates by price class the hottest selling price ranges in Houston in 2010:

 As you can see from the Top Ten Selling Price Classes in Houston for 2010, hot selling prices ranged from $80,000-$399,000. These price classes are expected to be hot in Houston at least through June 30^th because of the time-contingent 2010 IRS Home Buyer Tax Credit.  Setting aside this temporary demand incentive, these price classes are also more aligned with historical price class demand in Houston.

These attributes will spark demand through June, but what about the rest of the year?  While no one has an accurate crystal ball, Dr. Barton Smith of the UH Center for Public Policy remarked,” A year ago, I thought we’d be dragging behind the parade but we’re just not doing that.”

Houston Hotness Index Report for March 2010

A total of 21 Katy ISD schools have been recognized by the National Center for Educational Achievement (NCEA) for the 2010 Just for the Kids Campaign for Higher Performing Schools in Texas.

The Just for the Kids list is compiled annually by the NCEA. The analysis included student test results from spring 2007, 2008, and 2009.

The list is based on two factors: academic growth and college and career readiness. Schools recognized for growth achieved better improvement rates for their students compared with other schools with similar demographics.

Schools recognized for college and career readiness are the top 5 percent of schools in the state, based on the percentage of students scoring at or above NCEA’s career readiness targets.

Katy ISD Higher Performing Schools include:

• Taylor, Seven Lakes and Cinco Ranch high schools;
• Beck, Beckendorff and McMeans junior high schools; and
• Alexander, Rylander, Kilpatrick, Nottingham Country, McRoberts, Mayde Creek, Katy, Exley, Hayes, Schmalz, Williams, Pattison, Griffin, Fielder and Winborn elementary schools.

The Fourth Annual Katy Sunshine Fest will be held April 22, 2010.  This great event is brought to you by the Katy office of Prudential Gary Greene, Realtors with proceeds going in support of the Sunshines Kids (a non-profit organization dedicated to children with cancer).  We will have an amazing 8300 sq.ft. steel-erected tent in our parking lot (near La Centera).  Complmentary nibbles will be furnished by Rainforest Cafe, Candelari's Pizza, La Vida Loca, Hooters, Fish City Grill and Corino's. We will also have adult libations presented by Falcon Point Golf Club, Stadia Sports Bar and La Vida Loca.  Our amazing live auction will feature Country Music Legends signed guitar and hat; Rockets Championship signed basketballs; a signed Astro's home plate; plus many more outstanding items!!!  We will also have 3 exciting raffle items:  A trip to New York to see Kristin Chenowith in a broadway play; a Galveston get-away @ the San Luis; and a "stay-cation" at City Centre with dinner at Flemings.  If you would like an invitation to join us for the Katy Sunshine Fest, please email me at bob@bobmiles.com.

We just got back from our annual Prudential Real Estate Convention and were happy that not only did our Gary Greene brokers receive the broker of the year...but Prudential Gary Greene gave over $338,000 to The Sunshine Kids.  In fact the Katy office was proud to giver over $30,000! 

Houston finished the year down by only 7% in single-family total units sold and that is a miraculous recovery from February when year-to-date, we were looking at a 24% decline.  It also finished with a 1% increase in median sales price and anyone in the nation would envy that position.  

November was a great month for Houston real estate!

Every market indicator for the month was positive, except pending sales which dipped 15% below last November.

Houston Milestone: 

November YTD 2009 was the first month in 2009 where sales improved from double-digit declines to single-digit decline.  Single-family home sales year-to-date are now only 8% below last year – quite an improvement from YTD February sales which were 24% below 2008.