Home Prices in Houston: What to Expect
A popular saying is purported to be both a curse and a blessing: “May you live in interesting times.” The things that make life “interesting” are often both stressful and beneficial in random ways. The current real estate market is seeing a fair share of interesting times.
One major market factor to watch heading into 2023 is housing prices. Over the last three years, factors such as a major pandemic and a shift in workspace strategy encouraged many families to make residential changes. The interest rate was low, the demand was high, and the inventory was low; the result was an increase of 30% or more in housing prices.
But what can you expect in the future? In the next two years? Honestly, no one knows for sure and people in the know have a wide range of opinions. Matter of fact, just as many professional pundits expect the price to go up as expected the price to fall. If that leaves you scratching your head, you are not alone.
Home Prices in Houston: Lessons From 2008-2009
Prior to the housing bubble of 14 years ago, housing prices rose rapidly, and sales also rose precipitously. But three years later, housing prices had dropped by 27% across the nation. However, mortgage capital dried up as quickly and many buyers defaulted on their loans. The inventory was high, and few buyers qualified for loans. Sellers were anxious to unload their property at any price.
Home Prices in Houston: Current Conditions
Will the present market condition follow the 2008-09 pattern? No, the economic indicators are different now than then. Mortgage capital is still available, but the inventory remains low and the demand is also low. Home sales are a bit down, as folks are waiting for the mortgage interest rate to come down. So, what does that mean for housing prices?
- Home Prices in Houston generally increase by 4 to 5% annually, making real estate a pretty good investment. Double-digit housing price increases are unusual; the double-digit increase is not expected to continue into 2023.
- Since experts observe indicators that suggest Home Prices in Houston will both rise and fall, both might occur. That is, prices may fluctuate during the next 12 to 18 months.
- Another possibility is that Home Prices in Houston will rise or fall regionally; no one can guarantee which regions will see increases or decrease.
- Expect regional markets that were overheated or saw higher-than-normal price increases to remain volatile.
- Fear and uncertainty have been driving factors in the real estate market in recent years. Inflation, the lack of available housing stock, changing mortgage rates, and the recent increase in housing prices have been unsettling.
Since the real estate market is volatile and changes rapidly, both potential buyers and sellers benefit from developing a relationship with a local real estate agent. The Matthews Team’s local real estate experts will have the latest and most relevant information concerning the Houston market area that interests you most.