November 01, 2013 — Austin
In Texas, the weather is cooling off, but the real estate market remains red hot, according to the third quarter edition of the Texas Quarterly Housing Report released today by the Texas REALTORS®.
“In the fall, Texas REALTORS® usually start to catch their breath as the summer selling season draws to a close, but not this year,” said Shad Bogany, chairman of the Texas REALTORS®. “Demand for Texas homes remains strong and prices are increasing, keeping buyers and sellers in the market, and Texas REALTORS®, busy.”
According to the Texas Quarterly Housing Report, 80,105 single-family homes were sold in Texas in the third quarter of 2013. That is 18.97% more than the same quarter last year and, for the second quarter in a row, the highest volume of homes sold in Texas since the Texas REALTORS® began issuing the report in 2009.
Sales volume in the third quarter of 2013 was also almost equal to volume in the second quarter of the year. Jim Gaines, PhD., economist with the Real Estate Center at Texas A&M University, explained the significance, “We usually see a drop off in the volume of homes sold between the second and third quarter of the year, as homeowners settle in for the school year. We did not see that this quarter, even despite a slight increase in mortgage interest rates during that timeframe.”
Prices increased during the third quarter of 2013 as well. The median price increased by 10% from the same quarter of the prior year, to $177,100. The average price increased by 11.06% from 2012-Q3, to $230,474 this quarter.
Gaines continued, “Sales volume in Texas had been increasing for some time, but the price increases have been constrained by foreclosures and other distressed sales. Now, we’ve seen more than a year-and-a-half of price increases that outpace the average rate of appreciation in Texas, which is around 4.5 percent per year. This quarter’s annual double-digit price increase was more than twice that pace. Taken together, it’s clear that high demand for Texas homes is translating into higher prices for home sellers.”
As in past quarters, high demand contributed to a shrinking inventory of Texas homes during the third quarter. For 2013-Q3, the Texas market featured 4 months of inventory, which is 27.27% less than the same quarter of last year, when inventory was 5.5 months. The Real Estate Center cites 6.5 months as a market in which the supply of homes is balanced with demand.
“The inventory of homes in Texas is at historically low levels,” said Gaines. “To have only 4 months of inventory in a market as large as Texas is remarkable. Of the 47 markets included in the report, 10 have less than 3 months of inventory and that includes several large markets, such as Austin and Dallas.”
Chairman Bogany concluded, “This report is more evidence that competition for Texas real estate is fierce. Whether you’re a buyer who wants to nab that appealing property or a seller looking for top-dollar for your home, turn to your Texas REALTOR® for the advice, counsel, and resources that will help you compete successfully.”
The Texas Quarterly Housing Report is issued four times per year by the Texas REALTORS® with multiple listing service data compiled and analyzed by the Real Estate Center at Texas A&M University. To view the report for 2013-Q3 in its entirety, visit TexasRealEstate.com.