Texas' median home prices eclipsed $274,000 during 2021's first quarter, according to the latest figures from a realtor organization in the state.
Overall, 84,464 homes were sold statewide during the first quarter, representing a 10.1% increase from the same time last year, according to Texas REALTORS' quarterly housing report. The rise in home prices also represents a 13.4% year-over-year increase.
“The demand for housing in Texas remained strong despite the winter storm in February and the pandemic,” said Marvin Jolly, the group's chairman.
“With a low supply of homes for sale, though, prices in most areas have gone up significantly, and competition among buyers has increased as well,” he continued.
Economist Luis Torres, Ph.D. with the Texas Real Estate Research Center at Texas A&M University said the combination of low interest rates and sustained demand are indicators that the state housing market is healthy.
However, a historically-low housing supply is still one of the market’s greatest challenges.
“Depleted inventory is the greatest challenge to Texas' housing market, pushing up prices at elevated rates as demand remains strong, making it one of the most competitive housing markets for homebuyers since the 2006-07 housing boom,” Torres said in a statement.
“Rising mortgage rates in 2021 combined with recent rapid price growth will slow demand and, consequently, price growth to more sustainable levels,” he added.
Active listings are down 53% in 2021's first quarter when compared to last year, the report shows. In total, Texas has approximately 1.3 months of housing supply whereas it had almost 3 months of supply during the first quarter of 2020.
The Lone Star State had a $259,230 median home price in 2020, up 8% from the prior year, according to the group.
The National Association of Realtors says a balanced housing market has six months of supply.
Meanwhile, homes in Texas are also spending 20 fewer days on the market, averaging just 47 days before going under contract.
The total time from hitting the market to closing a sale decreased to 87 days from 100, according to Texas REALTORS' data.
Jolly said these two factors are contributing to the bidding wars many potential homebuyers across the state are weathering.
“Price plays a key role in winning offers, of course, but other considerations can come into play as well,” he said.
“Realtors have been helping their buyers and sellers sort through their options to help them achieve their real estate goals during a market that presents some unique challenges,” Jolly added.
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