How’s the Houston Real Estate Market? It Depends Where You Look.

If you’ve been following the headlines, you may have heard that Houston has more inventory, homes are taking longer to sell and buyers have more negotiating power.

All true. But those numbers don’t tell the whole story.

Houston is an increasingly segmented market, and what we’re seeing citywide can look very different from what’s happening in Memorial, West University, the Heights or even from one price point to another within the same neighborhood.

Here’s what stood out to us in the August numbers.

The Big Picture

Inventory has grown, giving buyers more choices and less pressure to make quick decisions. August closed sales were down 11.5% year over year, while pending sales increased 3.5%.

That combination is important. Demand is still there, but buyers have become more selective. Condition, location and pricing matter more when buyers have alternatives.

Where the Market Gets Interesting

The differences become much clearer when we look neighborhood by neighborhood.

Afton Oaks: 80% of homes that went under contract did so within two weeks, while sellers received an average of 96.5% of their asking price.

River Oaks: The pace was slower, with median days on market reaching 84 days and sales averaging just under 95% of list price. Buyers had more room to negotiate here than in several other close-in neighborhoods.

Memorial Area: recorded a median sales price of $1,338,750 in August, compared with $1,010,000 a year earlier, a 32.5% increase. At the same time, months of inventory declined from 2.9 to 2.3, and more than half of homes that went under contract did so within two weeks.

That 32.5% increase deserves some context. It does not necessarily mean Memorial home values increased 32.5% in a year. Median price reflects the homes that actually sold, and August saw a greater concentration of higher-priced sales. What is meaningful is the combination of a higher median price, tighter inventory and a relatively strong pace of contracts.

Tanglewood, the Heights and West University also showed strong activity, with nearly half of homes going under contract within two weeks.

The Inner Loop Tells a Similar Story

The Inner Loop is another good example of why the headline numbers need context.

Median days on market increased from 34 days last August to 51 days this August, while closed sales fell from 76 to 53, a 30% decline.

At the same time, the median sales price increased from $725,950 to $892,750.

Does that mean Inner Loop values increased 23% in a year? No.  Again, the mix of homes sold matters. What the numbers do tell us is that fewer homes changed hands, buyers took longer to make decisions, and the properties that sold were weighted toward higher price points than they were a year ago.

What We’re Watching

There isn’t one Houston real estate market right now.

Buyers generally have more choices and more time, but well-positioned homes in certain neighborhoods and price points can still move quickly. Sellers can’t rely on the market to do the work for them, and buyers shouldn’t assume that growing inventory means every property is negotiable.

The details of which neighborhood, price point, condition, competition and recent comparable sales matter more than the citywide headline.

If you’re wondering what these numbers mean for your home or a neighborhood you’re considering, reach out. We’re always happy to take a closer look at the market that matters to you.