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Temperatures dropped in August along with home sales in Houston, and while Houstonians welcomed the break from extreme heat, home sellers became anxious as market times increased.


While the market shift in August may have come as a surprise to some sellers, after 17 years of selling real estate, I want to remind everyone that the housing market typically cools in Houston as parents prepare to send the kids back to school and everyone comes back from vacation.


As families shifted their focus on back-to-school activities, there was little time to focus on buying a home, even if we weren’t also facing rising interest rates. As the housing market normalizes after a post pandemic frenzy, August was back to the status quo in relation to the housing market.


Hang on to your seats though! As we finish the Labor Day weekend, or what some people label as the last weekend of summer, we should see the Fall season pick up. Yes– there is a Fall season for home sales, and it typically starts after Labor Day weekend. According to Homelight, homes listed in September typically sell for more money.


While inventory levels have been creeping up in most markets and we have a 2-3 months’ supply of homes for sale verses a 1 month’s supply that we saw at the beginning of Summer, it is still a Seller’s Market, just a much tamer Seller’s Market.


Although interest rates are higher, home prices are leveling out so buyers do not have to compete against multiple offers and be forced to overpay for homes in most cases. There are still some homes that are exceptional that buyers are willing to pay above the market prices for, but I highly advise buyers to approach overpaying in this market. The last time I saw that happen in 2013-2015, those same buyers were upside down in their homes for at least 4 years.


Overall, this is a much calmer market for buyers to buy a home in, and it is still a reasonable market for sellers to sell.

We are officially in the third quarter of 2022, and while the year started off in a positive direction, there is lots of chatter about a recession and a housing market bust. Whether real or not, the chatter creates a slow down in spending on all sectors, and that includes the housing market.

As predicted, the feds have hiked interest rates 3 times already this year, and they are projecting to increase at least once more by the end of the year.  However, as of today, the average interest rate on a 30 year mortgage is still 5.5% and we are nowhere near the 7% that people were chattering  about in the 2nd quarter.

While I am not an economic expert, my 17 years of experience in Houston real estate has given me some insight on what to expect when the housing market shifts.

The second big word to watch besides Recession is Affordability.  Let’s face it, with an average of 20% appreciation on home prices in Texas over the last 2 years, we were already on track to price the housing market out of range for many buyers. Now with interest rates already 2 points higher than this time last year, home buyers will either have to decide to hold off buying, or they will have to lower their budgets.

In my humble opinion, the cool down of the housing market is a good thing for buyers. Due to abnormal low inventory levels, buyers have been paying above market for the last two years in order to compete with multiple offers. At least now buyers can expect to pay market value for a home, rather than overpaying.

I am fortunate to be a founding member of the Houston Relocation Network as well as a member of the Greater Houston Luxury Group, so I am able to gauge market opinions with some of the top Realtors in Houston on a monthly basis. In our last meeting, top Realtors in Houston all acknowledged that they have seen the showing activity slow down on listings, so Houston is feeling the impact of a market slow down.

I remain firm in my belief that Houston’s housing market will not slow down as quickly as the rest of the United States because our housing market typically follows oil and gas prices by 6-12 months, and with oil prices remaining around $100 a barrel, our housing market should remain strong. A “slow down” is a nice reprieve from the crazy fast pace and high prices that we have seen over the last two years, and buyers will actually stand a chance to buy a home without overpaying for it.

If you want to follow my Real Views on the Houston Housing Market, you can follow my monthly blog at www.energy-realty.com or check out my live version on Energy Realty’s YouTube channel.

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