Texas home sales volume and home prices reached all-time highs for the second consecutive year in 2016, the Texas Association of Realtors reported Tuesday.
Texas home prices rose steadily throughout last year, with the median price in 2016 increasing 7.6% from the year prior to $210,000. Sales volume increased 4.4% to 323,607 homes sold in 2016.
“Strong gains in end-of-year home sales activity were a key factor in making 2016 another record year for Texas real estate,” said Vicki Fullerton, chairman of the Texas Association of Realtors. “Last year’s record home sales activity was fueled by the momentum of multiple years’ strong job and population growth across the state, despite the fact that Texas job and economic growth began to slow in 2016.”
Jim Gaines, Ph.D., chief economist with the Real Estate Center at Texas A&M University, explained, “The 2017 Texas housing market is projected to keep pace with last year’s strong levels, but it may be difficult to match 2016 levels due to current housing supply levels. Household incomes are rising at a disproportionally low rate than home prices, creating housing affordability challenges across the state. In housing development, labor shortages and regulatory barriers are slowing construction and in turn, driving up new home prices.”
The state’s low housing inventory level remained consistent with the prior year, ending at 3.3 months of inventory in December 2016. According to the Real Estate Center at Texas A&M University, a market balanced between supply and demand has between 6.0 and 6.5 months of inventory.
Texas homes also continued to spend approximately the same length of time on the market in 2016, an average of 58 days, and active listings increased 10.8 percent from 2015 to 2016.
