Although time on markets and movement in supply are falling short of seasonal expectations, asking prices and online home searches have exceeded pre-COVID-19 numbers. In a time of great uncertainty and economic instability, this news is a glimmer of hope for Houston’s real estate recovery.
According to realtor.com‘s Housing Market Recovery Index, there are some signs of growth even as Covid-19 continues to leave its mark. For one thing, the Housing Market Recovery Index rose 1.2 points during the week ending June 13th. A second positive note: the median listing price Nationwide was up 4.6% compared to last year.
Other areas continue to reflect the uncertainty brought about by the pandemic. According to the Index, houses are on the market around 16 days longer than last year, and new listings are down 20%. One noteworthy piece of data is this: housing markets which benefitted from high job creation in the tech sector before the pandemic are recovering fastest.
In a recent press release, director of economic research for realtor.com Javier Vivas said, “Markets with stronger job creation pre-COVID are proving to have the crucial edge for real estate activity, particularly those with a strong technology sector. As more tech companies weather the storm, the stable jobs and incomes they offer will continue to power demand for homes in these areas, enabling home sales to bounce back faster than the rest of the country this summer.”
When looking at pre-COVID numbers, there are 8 local markets that have surpassed the January 2020 baseline. Those housing markets include Rochester, New York, Las Vegas, Los Angeles, and Seattle. Supporting the tech hub theory, we see markets in San Francisco, San Diego, and Boston also exhibiting positive signs of recovery.
In Houston, the recovery index score still sits below the January 2020 baseline. However, in the week ending January 13, it grew 3.6% from the week prior. Because real estate was declared an “essential service” in Houston, the local housing market fared better than many ofter cities across the U.S.
Houston recovery is best viewed on a case-by-case basis with a focus on specific regions and neighborhoods. Some areas have been hit much harder than others by the pandemic and oil crash. For example, regions with strong ties to oil and gas like The Woodlands and the Energy Corridor have been pummeled by gas company personnel cuts.
For most of Houston, this is still a seller’s market. However, we must again look at specific neighborhoods to recognize the discrepancies. Certain home sales should still farewell, even in the current market. Desirable factors include homes zoned for high-ranked schools, homes with land, and homes located in close proximity to major job centers.
Here are some helpful points to consider when gauging Houston’s potential for recovery:
- Houston boasts over 500 tech companies
- Houston has over 360,000 health care professionals
- Houston is the #1 seaport in North America
- Houston has the 4th highest number of Fortune 500 companies