Landlords and investors have always had their pick of exciting options in the ever-changing Houston real estate market. The first few months of this year were great for Houston home sales, beating out sales in 2023.
Unfortunately, this solid kick-off suddenly changed at the start of the 2nd quarter. As an investor, you might notice the small drop in the housing market due to a derecho storm that hit the city in May.
Meanwhile, Houston's rental market hit a new high point in June, when rent rose to a level never seen before. As a landlord, you might also notice the consistent search of people for single-family rental homes in the city.
Many things affect the rental market in the city. You have to consider the Houston real estate trends, factors that affect rental prices, the different types of rental properties, and the cost of living. Knowing these things is essential for you and Houston investors in figuring out great strategies for your rental property business.
Many people looking for a change of pace relocate to Houston. This is aside from the fact that Houston is a flourishing metropolis and is considered one of the most rapidly expanding major cities in America.
Space City is also a great place to live for families and young professionals because of its history of rapid development, a vibrant job market, a diverse range of cultures, and a reasonable cost of living.
As we are in the middle of the second half of 2024, we know how crucial it is to keep up with the latest news and trends in the Houston real estate and rental market whether you are a new investor or a seasoned landlord
So, in this article, we will take a look at how the Houston real estate market is performing this 2024.
Houston Real Estate Trends
As we mentioned earlier, there was a sudden drop in Houston real estate in May. However, even though home sales have been slow, there are signs that the market is starting to get better. Currently, Houston is a seller's market. This means there are enough homes for sale to last a maximum of six months at the current sales rate.
The upcoming U.S. presidential election could also affect the Houston real estate market. It is a common trend that house sales slow down in the months before an election. This is because buyers and sellers are waiting to see which party will lead the economy.
The trend this year also shows that sales of high-end homes are on the rise, which could be good for real estate agents and investors interested in this type of market.
Single-Family Homes
Even though more homes are coming on the market, prices are still very high. Home prices for single-family houses hit an all-time high of $443,970. The price has gone up by 3.6% in a year. The median price, on the other hand, went up by 1.5% to $345,000.
The high price of single-family homes caused a decline in sales by 1.5%, with 8,538 units sold from 8,664 sold units last May. Despite this drop, the trend still shows faster sales in the Houston real estate market from 49 to 45 days. This trend can be linked to millennials getting ready to buy their first homes and wantind to do so even though loan rates are higher, which drives up home prices even more.
Townhouses and Condominiums
It was recorded that inventory for townhouses and condominiums in the Houston real estate market reached its peak in May, at 4.7 months. This is the highest inventory for townhouses and condominiums since October 2012.
Houston townhouses and condominiums' average prices rose to a record high of $281,777. That is 7.5% higher than last year. Its median price, on the other hand, is at $241,600 which is 12.1% higher than May 2023.
These high prices caused a 9.8% fall in Houston's townhouses and condominiums sales year-over-year. That is 555 closed deals compared to the 615 sales it had last year.
Houston Rental Market Trends
Many factors affect the city’s house rental market such as its strong job market, economic and population growth, and neighborhood desirability. Based on the Houston Association of Realtors’ (HAR) June 2024 Rental Market Update, its real estate lease prices hit a record high in June, marking a new high point in the city's rental market.
Single-Family Rentals
In June, the average price of Houston's single-family rentals was $2,373, which is a 1.3% rise compared to June 2023. This resulted in an increase in leased listings from 4,225 to 4,358 this year. New listings also thrive in 2024 which is at 6,298. That is an 8.5% increase compared to last year.
Meanwhile, these changes don't greatly affect the Days on Market (DOM) of single-family rentals which only increased a day from last year.
Townhouse and Condominium Rentals
The rental trends for townhomes and condos went down this year. Its average lease price fell to $1,989 from $2,048 in June 2023. This was followed by the total number of leased listings which were down by 2.8%.
This trend didn't affect the number of new listings which has an increase of 16.9% compared to last year. However, this increased the number of its DOM to 44 days compared to 35 days in June 2023.
Built-to-Rent Community Units
As it gets tougher to buy a home, the Houston real estate market has become a leader for built-to-rent homes. Houston is Top 4 in the new built-to-rent single-family houses in the U.S. in the last five years. Adding here are the 4,836 built-to-rent units expected to be completed by next year.
Built-to-rent units are great for people who want more room but can't afford to buy a house. This is also great for empty nesters who want less housework.
Always Stay Updated with the Latest Houston Real Estate Trends!
Houston is one of the best places to invest in real estate. As the population grows and the job market gets stronger, it has become a popular place for investors and landlords like you who want to run a rental property business.
Before you do any of that, you should know what's going on in the Houston real estate and rental market. It will be easier for you to make the most of your investments and see significant returns in 2024 if you stay up-to-date on urban development plans, local economic forecasts, and real estate market trends. Knowing these sectors will also help you to make informed investment decisions.
But we know that investors and landlords like you have too many responsibilities on your plate to always keep track of what’s happening in the Houston real estate market.
No worries, we got you covered! Here at Terra Residential Services, we will take care of your rental property business while making sure that you are not being left behind in Houston real estate market trends.
Whether it’s for property management or acquisition and sales services, we are always ready to help! Drop us a message to know the best property or most efficient strategy for your business!
