Home sales

Home sales slow slightly amid rising interest rates | Immovable

Home sales have slowed in the Houston area due to higher interest rates, but that has done little locally to stem interest in buying in the area, according to several real estate agents.

Sales of single-family homes fell about 17% in July, compared to the same month in 2021, according to an August report from the Houston Association of Realtors. That makes it the fourth consecutive month of declining sales, according to the report.

But just because the area has seen some downturn doesn’t mean the leader’s coverage area has either, according to Michael Clark, a Houston-area real estate agent.

“It all depends on the neighborhood and the market,” he said. “Some areas are slowing down more than others. But the hot areas are still quite busy.

Clark is doing a lot of work in the northwest of the city, including Oak Forest and Garden Oaks, and told the chief this week that area remains strong, he said.

The market may have slowed slightly, but not by much, he said.

“Homes that used to take a day or two to sell are on the market a little longer, but not much longer,” he said. “Especially in the area we’re talking about – this northwest market.”

Elizabeth Villarreal, another real estate agent, agreed with Clark that homes are still selling fairly quickly.

“I’m always busy,” she says. “Ads are coming in and people are still showing houses.”

Despite local real estate experts’ optimistic view, July’s 8,370 home sales are the lowest one-month total since January, and the market is about 1.3% behind 2021, according to the Houston. Association of Realtors.

“Houston’s blistering pace of housing for most of the pandemic was completely unsustainable, so the cooling we’ve been experiencing over the past four months was expected and part of a normalization of the market,” Jennifer said. Wauhob, president of the association.

Experts have been predicting a slowdown in real estate for several months now. This year, the US Federal Reserve has steadily raised interest rates to around 2.25-2.5% in an effort to reduce inflation, according to a July Wall Street Journal report.

This increase has led to higher interest rates for a host of services, including mortgages, cars and credit cards, according to a Spectrum News article.

While the majority of those who spoke to the leader were cautiously optimistic that the downturn would not have major effects on the market, Sara Black, another real estate agent living in the heights, said she told clients to expect further declines.

“Buyers are proceeding with caution,” she said. “I see a lot of properties with daily discounted prices.”

Some neighborhoods are doing better than others, and higher interest rates primarily affect affordability, but buyers, especially those looking for higher dollar homes, are more cautious now than they used to be. were early in the pandemic, Black said.

“Houston is still a strong market, but I have a feeling things will continue to decline,” she said. “I know I’m going against what a lot of others are saying, but I think they don’t want to scare people off.”

While Black expects further declines, she added that she has told clients that if they expect to stay in a home for five years or more, that should be fine.

“I’ve been saying this since the peak, when prices were up 20% or more,” she said.

Despite the market downturn in Houston, the average price of a single-family home still rose about 9.9% in July, to $426,494, according to the Houston Association of Realtors.