Home prices are rising in many Texas regions. Real Estate Center research has shown that the key determinant of future house price appreciation is the inventory of homes for sale in each local market. When there are many listings available to choose from, price appreciation can be sluggish. Conversely, when there is a dearth of listings, prices can spike as buyers vigorously compete for the few homes that are available for purchase.
Listing inventory was tight last year for much of the state. I thought it would be good to see how the current inventory compares with last year as we approach the peak selling season in the Texas housing market.
The Center reports there were 79,637 Texas homes for sale in March 2014, which is down 8 percent from 86,475 in March 2013. Lower inventory levels will put continued upward pressure on home prices.
I have listed the regions in Texas that have fewer homes for sale this year than they did last year. The number of listings in March was 28 percent lower in Bryan-College Station than the prior year. Corpus Christi was down 27 percent, and Arlington was down 21 percent.
The biggest cities had inventory declines as well. Houston had 15 percent fewer listings this year and Dallas had 12 percent fewer. Fort Worth was down 16 percent. Austin and San Antonio had 6 percent fewer listings this spring.
Some Texas cities and regions actually have more inventory available than they did last year. The next table ranks them by the percentage increase in listings from a year earlier.
It is encouraging to see the inventory of homes for sale increasing in some of our Texas housing markets. We need more inventory. Odessa is a good example. Even though there are more homes for sale this year, there are only 2.2 months inventory available. This is well below the 6.5 months of inventory considered to be a balanced market.
Clearly, the market is tight going into the prime selling season for homes in many areas of Texas. Buyers will face a shortage of options when looking for homes. Prices are going to go up.
There are many great Austin area homes for sale. Click here to perform a full home search, or if you’re thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today’s market.
You may also call us at (512) 537-6739 for a FREE home buying or selling consultation, so that we may answer any of your real estate questions.