April another down month for Houston home sales as prices finally begin to soften

Houston's post-pandemic housing market hangover continued in April, with home sales down for the 13th consecutive month. In a new report released Wednesday, the Houston Association of Realtors said home prices dipped more than 18% last month compared to the same month in 2022.

"Interest rates are rising, taxes are rising, it's just a domino effect," HAR Chair Cathy Trevino said. "Insurance is rising, so all of these have an impact on your final payment and it is putting a crunch onto a lot of buyers."

The newest twist affecting Houston's housing market is falling prices. HAR says the median price of a home in Houston declined 3.6% last month, to $331,000, the second straight month of lower prices. The average price of a home dropped 1.6%, to $419,929. That's compared to more than $438,000 in May of last year, a record for Houston.

Other markets, like Austin and cities on both coasts, have seen far more dramatic price swings over the past few months. But any sign of softening home prices in Houston is an indication that many home sellers are reconsidering what it's going to take to move their property.

"We are starting to see sellers come to terms with that," Trevino said. "Sellers do have unrealistic expectations still."

Another factor in the local home sales slump is one that many real estate experts could not have predicted. A few years ago, when mortgage rates hit record lows, homeowners locked themselves into deals that were hard to beat. Now, if they want to sell and move, they're finding those so-called "golden handcuffs" are making things considerably more difficult.

"You have sellers who don't want to move and they're staying in their homes longer because they got such an amazing interest rate and they don't want to have to purchase something at a higher interest rate," Trevino said.

That has led to an inventory problem over the past several years, which in turn has kept home prices higher than some experts expected. According to HAR's latest report, that inventory issue is getting better, with 2.7 months-worth of available housing last month, up considerably compared to one year ago.

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