Houston Real Estate Trends: Market Stabilizes with Slowest Sales Decline in Over a Year - August 2023 Overview

The Houston real estate market is indicating signs of a "soft landing" as declining sales have slowed to the lowest rate in over a year. Despite negative indicators, the housing market shows signs of a return to more seasonal trends. Home sales in Houston have been down for 17 consecutive months, but the rate of decrease in August was the smallest since last spring. Single-family home sales dropped 3.8% year-over-year with 7,983 units sold compared to 8,301 in August 2022. The rate of decline is the lowest since May 2022.

The luxury housing segment was the only sector to experience a gain. Rental rates for single-family homes and townhomes/condominiums remain solid. Single-family home prices continue to stabilize, with an average price increase of 2.5% to $420,124, while the median price remained statistically flat at $339,000. Sales were 8.0% lower when compared to August 2019 pre-pandemic.

Total property sales and total dollar volumes also fell below last year's levels. The total dollar volume was $3.8 billion, down from $3.9 billion a year earlier. Sales of townhouses and condominiums dropped 19.0% year-over-year, marking their 15th consecutive monthly decline. Meanwhile, months of inventory in August expanded to a 3.3-months supply, which is the highest level since May 2020. This level aligns with the national months supply as reported by the National Association of Realtors (NAR).