Realtors’ Leader is Wary of Limited Inventory

According to Nancy Sarnoff, Houston Chronicle – www.chron.com, she explains how the chair of Houston’s realty association, describes the current housing picture. “Tight home supply lifts prices, but could slow sales,” the chairman of Houston Realty Association, www.har.com, Chaille Ralph, warns. She goes on to say, “We still need inventory. That’s critical to see the market move.” The Houston Association of Realtors released its monthly report on the local housing market and the inventory, which is measured in months, fell to a new low in December & hasn’t budged since, putting shoppers at a disadvantage when negotiating to purchase homes in some areas.
Realtor Yau Tam, was representing a buyer recently who was one of multiple bidders on a property in Rice Military priced in the low $400,00’s. Her client got the home because she offered several thousand dollars more than the seller was asking & submitted a stack of bank statements “to show she was a slam-dunk for loan approval,” Tam said. “Even homes in the low $100,000 are getting multiple offers & are very competitive to buy,” she said.
The Houston area has had a 2.6-month supply of inventory since the end of last year, meaning it would take that long to sell all the homes on the market based on recent activity, according to the association. Six months of inventory is considered a healthy market where neither buyer nor seller has the upper hand. Pending sales, an indicator of future activity, totaled 3,777 at the end of February, a 2.6 decline compared to last year. That leads Ralph to believe the pace of sales will slow. But even if the market retreats, she said, it’s not for lack of demand. “There are plenty of buyers out there that are trying to compete,” she said.
Buyers closed on 4,765 single-family homes in February. That’s an 8.3 increase over the same month a year ago 7 the 33rd straight monthly increase. The overall low supply, coupled with an increase in the number of high-end properties trading hands, propelled the prices of Houston’s median & average homes.
The median price – the figure at which half the homes sold for more & half for less – was up 11.7% to $181,500 in February, while the average price jumped 12,5% to $247,534, according to the association’s data, which is based on properties sold through the Multiple Listing Service, which tracks sales activity in Harris, Fort Bend, & Montgomery counties, as well as parts of Brazoria, Galveston, Waller & Wharton counties.

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