Bill Rapp here with the Heartfelt and Hot in Houston Blog, and this is our newest segment: Real estate market humming during COVID!
Meredith Moore knew June was not the ideal month to move to Houston — the oppressive heat, the mosquitoes and the possibility of hurricanes.
But when she Googled “best suburbs in Texas” from the tiny one-bedroom apartment she shared with her husband on Manhattan’s Upper East Side and started perusing homes in The Woodlands and Sugar Land, she shrugged it off and called the moving van.
“I was shocked at the amount of house you could get for the money,” said Moore, a 30-year-old New York native who arrived in Houston with her husband Brendan, 34, in the first week of June. Real estate market humming during COVID!
Expat New Yorkers may find Houston housing prices alluring, but locals have been watching a slow, steady rise. Prices were up more than 3 percent last year as more homes sold. Sales figures have since plummeted with the pandemic, and the Moores, who had never been to Houston or its suburbs before moving here, are part of a group of buyers cushioning the blow to the local housing market.
While many of those braving open houses and negotiating purchase contracts are motivated by ultra-low mortgage rates or the need for more space for a growing family, a new type of house hunter is emerging: the pandemic buyer.
Brendan Moore and his wife, Meredith Moore recently moved to The Woodlands from New York City shown Sunday, June 21, 2020. They plan to buy a home.
These are individuals whose priorities around where and how they live have shifted as a result of the coronavirus. Some who had been looking at older homes are now shopping only for new ones. Others, feeling cramped after working from their bedrooms or kitchen tables for many months, are looking for bigger houses. Longtime renters are suddenly in the market, too, as they seek to escape dense apartment living.
These new buying patterns reveal some of the virus’s unexpected consequences on the real estate market. They reflect consumers’ fears of COVID-19 and their hopes of being able to safely ride out the pandemic and perhaps emerge from it with a more comfortable lifestyle.
The Moores, for example, had been planning to move to Austin, but after being stuck in their 600-square-foot New York apartment during the COVID-19 lockdown — sometimes not stepping foot outside for two-week stretches — they decided to look for a suburb in a lower-cost-of-living area with open spaces, big yards and more affordable housing. They’re renting in The Woodlands and plan to start house hunting there in January.
Home values in The Woodlands and many neighborhoods close to downtown have seen healthy increases in recent years among a persistently low supply of properties for sale Across Greater Houston, , annual price appreciation across the greater Houston area has ranged between 3 percent and 5 percent.
Last year, the median price of a single-family home was $245,000, up 3.2 percent from 2018, according to an analysis of home sales and prices collected by the Houston Association of Realtors for the Houston Chronicle. The figures were based on 86,205 single-family home sales handled through the association’s Multiple Listing Service, up from 83,509 in 2018. It was the fourth consecutive record-breaking year for Houston real estate. Real estate market humming during COVID!
This year will be different. Home sales are already off 4.3 percent year-to-date and a collapse in oil prices has led to layoffs at some of the area’s biggest companies, likely leading to more softening in the housing market later this year.
Still, real estate in Houston has shown resilience in previous downturns. Despite the economic and pandemic clouds that hang over the region, houses are selling — some in days and after bidding wars. Some experts attribute the activity to pent-up demand from March and April when people were staying home.
Economist Ralph McLaughlin said the broader housing market is holding up throughout the pandemic because of low mortgage rates, federal stimulus and government protections that have helped people who have lost jobs stay in their homes. National mortgage application activity, too, has risen above last year’s levels.
“Texas and Houston tend to not deviate that much from the national average,” said McLaughlin, chief economist of Haus Inc., a San Francisco-based real estate investment startup. “Houston is an oil town by historic standards, but it’s evolved to be a more dynamic area than in the past.”
Low inventory is supporting local home prices. Sellers with newer or renovated homes and those whose properties are priced slightly below market rate are seeing multiple offers.
In June, real estate agent Anna Lee Trinidad was meeting a buyer at an open house in Ashcreek, a neighborhood in northwest Houston, when she saw something that stopped her in her tracks: a line of cars. She thought someone must have been having a party but the traffic was for the open house.
“I had to park three blocks away,” said Trinidad, an agent with Berkshire Hathaway HomeServices Tiffany Curry & Co. “I’ve never seen anything like it.”
The three-bedroom house, built in the mid-1980s, was just over 1,400 square feet. It had recently been remodeled and was priced at $159,000. At that amount, the house was bound to have brought bids from investors, many of whom pay cash, edging out other buyers.
“We made an offer but it was just not something we would have gotten,” Trinidad said. “We didn’t get a call back.”
Anything priced at less than $250,000, Trinidad said, doesn’t last on the market. She expects that to be the case for the rest of the summer. Builders aren’t building enough affordably priced homes and homeowners who would normally sell to move up are staying put because of the pandemic and the recession.
Tiffany Curry, owner of the Berkshire Hathaway HomeServices franchise, works with companies relocating employees to the Houston area. But with air travel limited, out-of-town buyers don’t always have the opportunity to shop in person.
“We’ve seen quite a few people buying homes sight unseen, which is very different for us,” Curry said. Real estate market humming during COVID!
The inspiration for today’s edition came from this original article: https://www.houstonchronicle.com/business/article/pandemic-buy-houston-real-estate-market-home-covid-15412759.php
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