Texas home sales volume maintained the rapid pace of the summer selling season in the third quarter of 2014, while monthly housing inventory increased on a quarterly basis for the second time in three years, according to the 2014-Q3 Texas Quarterly Housing Report released today by the Texas Association of Realtors.
The third quarter of the year is typically a much slower sales period summer is over, school has started and families are staying put for the upcoming holiday season. That was not the case this year, said Dan Hatfield, chairman of the Texas Association of Realtors. Texas home sales continue to slightly exceed last years levels. If this trend continues, 2014 will surpass 2013 to become the second-best year ever for Texas real estate.
According to the report, 80,851 Texas homes were sold in 2014-Q3. This is only 0.63 percent less than home sales volume in the previous quarter and 0.61 percent higher than home sales volume in 2013-Q3. While several local Texas markets have experienced slight declines in home sales in 2014, statewide home sales have remained steady due to much-needed gains in housing inventory and a continually strong housing demand.
Monthly housing inventory in Texas increased on a quarterly basis for the second quarter in a row, rising 2.77 percent from 2014-Q2 to 3.7 months. While inventory is still down 7.5 percent compared to 2013-Q3, the Lone Star States year-over-year decreases in inventory have eased significantly from the sharp 20- to 30-percent drops experienced over the last two years.
However, it will be some time before Texas housing inventory returns to 6.5 months, the level which the Real Estate Center at Texas A&M University equates to a balanced housing market. Jim Gaines, Ph.D., economist with the Real Estate Center explains:
Developers are building homes about as fast as they can, but continued shortages in labor and vacant developed lots are keeping homebuilders from increasing production even further, said Gaines. Combined with higher home prices and tough lending standards, the Texas housing market will remain very competitive for homebuyers into 2015.
Home prices continued to increase at a steady, but slower pace in 2014-Q3. Median price increased 6.84 percent year-over-year to $188,900, while average price increased 5.91 percent from 2013-Q3 to $243,548. Only a few local markets are still seeing the near double-digit home price gains that Texas has experienced since 2012. In Texas major metros and statewide, home price increases have slowed to between five and nine percent year-over-year.
Chairman Hatfield concluded, Approximately 1,600 Americans per day relocate to Texas to take part in our states booming job market and economic growth. The future sustainability of the Texas housing market is dependent upon having the right infrastructure in place to support our states rapid growth. The Texas Association of Realtors encourages Texans to take action by voting for Proposition 1 on Nov. 4, which will be a big step forward in meeting the approximately $5 billion in statewide transportation needs that go unmet each year.
About the Texas Quarterly Housing Report
Data for the Texas Quarterly Housing Report is analyzed by the Real Estate Center at Texas A&M University using statistics compiled from multiple listing services in nearly 50 markets throughout Texas. The report includes data for single-family home sales over the course of one quarter and is scheduled for release by the Texas Association of Realtors on the following dates each year (or the next business day): Feb. 1, May 1, Aug. 1 and Nov. 1. To view the 2014-Q3 report in its entirety, visit TexasRealEstate.com.
About the Texas Association of REALTORS®
With 90,000 members, the Texas Association of REALTORS® is a professional membership organization that represents all aspects of real estate in Texas. We advocate on behalf of Texas REALTORS® and private-property owners to keep homeownership affordable, protect private-property rights, and promote public policies that benefit homeowners. Visit TexasRealEstate.com to learn more.