Texas Housing Market Analysis - July 2024
The Texas housing market in July 2024 presents a nuanced picture with various indicators showing both growth and decline. This analysis delves into the key metrics to provide a comprehensive overview of the current state of the market.
Median Sales and List Prices
The median sales price for homes in Texas stands at $355,000, reflecting a slight year-over-year (YoY) increase of 0.2%. This modest rise suggests a relatively stable market in terms of sales prices. Conversely, the median list price has decreased by 1.8% YoY, now at $366,300. This decline in list prices could indicate a shift towards a more buyer-friendly market, as sellers may be adjusting their expectations to align with current market conditions.
Price Per Square Foot
The median price per square foot has seen a marginal increase of 0.5% YoY, reaching $183. Meanwhile, the median list price per square foot has risen by 3.1% YoY to $189. This discrepancy between the sales and list price per square foot suggests that while sellers are listing homes at higher prices, the actual sales prices are not increasing at the same rate, potentially due to negotiation or market corrections.
Sales and Inventory
The number of homes sold in July 2024 is 28,883, showing a slight YoY increase of 0.2%. However, pending sales have dropped significantly by 8.9% YoY, totaling 31,983. This decline in pending sales could be a precursor to a slowdown in future closed sales. On the other hand, new listings have increased by 1.3% YoY, reaching 39,183, indicating a steady influx of new properties into the market.
Inventory levels have surged by 23.6% YoY, now at 116,320 homes. This substantial increase in inventory, coupled with the rise in new listings, suggests that the market is becoming more saturated. The months of supply metric, which has increased by a staggering 70% YoY to 4 months, further supports this observation. A higher months of supply typically indicates a shift towards a buyer's market, as there are more homes available relative to the number of buyers.
Market Dynamics
The median days on market have increased by 11% YoY, now at 45 days. This longer duration indicates that homes are taking more time to sell, which could be a result of the increased inventory and more cautious buyer behavior. The average sale to list ratio has slightly decreased by 0.7% YoY, now at 97.5%, suggesting that homes are selling for slightly less than their listed prices.
The percentage of homes sold above list price has dropped by 6.4% YoY, now at 13.7%. This decline indicates that fewer buyers are willing to pay above the asking price, possibly due to the increased inventory and more competitive market conditions. Additionally, the percentage of price drops has risen by 4.6% YoY to 37.3%, further indicating that sellers are adjusting their prices to attract buyers.
The percentage of homes going off the market within two weeks has decreased by 7.9% YoY, now at 24.5%. This decline suggests that homes are not selling as quickly as they were in the previous year, likely due to the increased inventory and longer median days on market.
Conclusion
In summary, the Texas housing market in July 2024 exhibits a mix of stability and emerging challenges. While median sales prices have remained relatively stable, the decline in list prices and the significant increase in inventory and months of supply indicate a shift towards a more buyer-friendly market. The longer median days on market and the decrease in homes sold above list price further support this trend. As the market continues to evolve, both buyers and sellers will need to adapt to these changing dynamics.
