Houston real estate registered its best year on record in 2017, despite Hurricane Harvey in August. Sales and median prices for single-family homes reached their highest ever and rental properties saw the greatest activity of all time.
According to figures released by the Houston Association of Realtors (HAR), the Houston real estate market saw yet another record year for sales and price rises in 2017. The historic highs came in a year marked by set-backs.
Houston resilience
“No one could ever have imagined 2017 turning out to be a record-setting year for the Houston real estate market,” said Kenya Burrell-VanWormer, Chair of HAR. She cited two obstacles in the property market’s way: the energy sector slump and the hurricane.
Houston began the year in recovery mode from the downturn in oil and gas prices, which has affected the energy sector in the city. Recovery has been slow but sure throughout the year and Houston registered strong job creation throughout 2017, particularly in the final few months.
The arrival of Hurricane Harvey in late August, however, brought a devastating blow to the city. But as Burrell-VanWormer points out, Houston recovered quickly. Just four weeks after Harvey, the Houston property market rebounded. “This clearly illustrates the incredible resilience of the people and the economy of Texas,” she said.
Records for single family home sales
Proof of Houston's real estate ability to bounce back comes in the figures for single-family homes. In 2017, sales went up 3.5% on 2016, itself a record year. Dollar volume of sales rose by 6.5% to reach US$23 billion. June was the best month for sales, followed by December when an increase of 4.1% was recorded.
In terms of median prices, 2017 saw an uptick of 3.8% on 2016 to US$229,900, the highest on record. The December median price was the highest ever for this month when sales in the US$250,000 to US$499,999 price bracket were particularly strong.
Low Houston real estate supply
One constant carried through from 2016 into 2017 in the Houston property market: lack of supply. The city has suffered from a shortage of available property for several years now and last year was no exception.
Houston started 2017 with just 3.3 months’ supply of available property. By the end of December, this had fallen by 0.1% to 3.2 months. With strong demand for both rental and resale property, the Houston market shows no sign of improving its inventory levels, at least for the short term.
Record rentals
The Houston rental market also saw a booming year in 2017. It was so busy in fact that HAR described it as “the greatest activity of all time”. Demand for rental properties was particularly high in the aftermath of Hurricane Harvey. In December, rental prices for single-family homes rose by 3.3% to reach an average of US$1,745.
(Source: Houston Association of Realtors)
