Skip to main content

Hot Texas Market Probably Cools Quickly

Jul 22, 2020
Texas Longhorn
Senior Editor

Existing homes sold in June through Texas Multiple Listing Services (MLSs) surpassed 29,000 for the first time since August 2019. Housing experts for the Real Estate Center at Texas A&M University point out the trend may not last.
 
“Texas’ housing market rebounded after two and a half months of sluggish activity amid the economic shutdown and social distancing measures,” said James Gaines, chief economist for the Real Estate Center. “June housing activity recovered substantial pent-up demand from the economic shutdown.”
 
After accounting for seasonal factors, the state’s MLS homes sales increased 34% relative to May but remained below first-quarter levels. “This positive momentum, however, may be temporary as new coronavirus cases have accelerated in recent weeks,” said Gaines.
 
According to the National Association of Realtors, existing-home sales across the country exhibited a similar pattern with a 20.7 percent increase from May but remained subdued on a year-over-year basis. Low mortgage rates bolstered demand for first-time homebuyers, which accounted for 35% of national sales in June.
 
Center Research economist Luis Torres said there are fundamental challenges facing the housing market in addition to the COVID-19 pandemic.
 
“The months of inventory for existing homes plummeted to a record low of 2.7 months, exacerbating shortages, particularly for homes priced less than $300,000,” said Torres. “The number of new listings hitting the market stabilized but lagged year-ago levels by nearly 9 percent. This imbalance has housing affordability implications, as evidenced by a 4 percent year-over-year increase in the Texas Repeat Sales Index.”
 
The median price for an existing Texas home sold jumped from $235,000 in May to $250,000 in June. Texas remained price competitive relative to the rest of the nation, where the median price was $284,600. “While June was a positive month for sales activity, the resurgence in contracted coronavirus cases and hospitalizations could reverse the recovery and remains the greatest obstacle to the housing market,” Torres said.
 
Read more about the Real Estate Center's research staff's thoughts on the economic impact of COVID-19 in Texas.
About the author
Senior Editor
Keith Griffin is a senior editor at NMP.
Published
Jul 22, 2020
The Agency, Barrett Financial Group Launch Joint Venture

Aclara Lending will offer its luxury clients a diverse selection of loan products, sourced from 140 different wholesalers.

Oct 07, 2024
NAR's Chief Legal Officer Steps Down

Katie Johnson led the association's legal team for 10 years

Oct 01, 2024
NAHB, Regions Bank, And Others Provide Disaster Relief

Regions Bank provides disaster-recovery financial services and NAHB helps rebuild

Oct 01, 2024
Rocket Mortgage And Annaly Capital Management Enter Subservicing Agreement

Rocket will handle all servicing and recapture activities for a portion of the mortgage servicing rights held by Annaly.

Oct 01, 2024
Florida Receives $1M In Disaster Relief From Fairway Independent Mortgage Corp.

Fairway CEO calls out competitors to lend a helping hand as Florida homeowners are left reeling from disaster

Sep 30, 2024
Buyers Usher Into Market After Rate Cut

Buyer agents surveyed report 'minimal market disruption' following NAR Settlement

Sep 27, 2024