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Houston’s housing market remained red hot in 2014 – its best year on record – but a cool down might be coming. There were 75,319 single-family closings and 91,202 total closings in 2014, representing the most transactions in Houston’s history, the Houston Association of Realtors (HAR) report on January 14th. Those figures are up 2.8% and 3.5%, respectively, year over year.
July saw the largest one-month sales volume, with 7,613 single-family closings, while January 2014 had the smallest number of closings, 3,930. The biggest year over year increase in sales occurred in December, when single-family home sales jumped 11.6% compared to December 2013.
For the full year, the single-family average sales price was $270,182, up 8.7% from 2013, and the single-family median sales price was $199,000, up 10.6%. For all of 2014, the total dollar volume of sales increased 12.7% year over year to $23.55 billion, another record. All of that demand has pushed supply to record lows, ending December at 2.5 months. Months of inventory reflects how long it would take to sell the homes currently on the market based on the past 12 months of sales activity. But after 2 straight yeas of record-breaking real estate activity, the market might be slowing down soon.
“We expect the pace of sales to normalize this year, which should finally enable inventory levels to grow, restoring balance to the market,” HAR Chairwoman Nancy Furst, with Berkshire Hathaway HomeServices Anderson Properties, said in a statement.
Buyers also might become more cautious this year, as oil prices have hit 5 year lows after falling for months. The impact on the energy industry likely will have some sort of ripple effect on other sectors of Houston’s economy, though the extent of that is not yet clear.
“In the short run, we won’t see a whole lot of direct impact on housing,” Jim Gaines, a research economist with the Texas A&M University Real Estate Center, told Houston Business Journal late last year. “But it’s one of those clouds on the horizon. We’re not sure how hard it’s going to hit or how fast it’s going to get here.”
Article courtesy of Olivia Pulsinelli with Houston Business Journal