From a buyer’s perspective..
There’s a lot of inventory to choose from in Houston, especially at the $200-$300k price point. We’ve recently noticed that buyers are on the fence about purchasing, since interest rates have continued to rise.
It’s been a year since Hurricane Harvey, and an interesting one at that. Oil prices have been on the rise, which is typically great for the Houston economy, however, it’s not brought back the amount of jobs originally predicted. Many oil companies are relying on efficiencies built while oil was down and are recouping losses experienced during the last few years. Demand is simply not as high as it’s been in the past.
In addition, we’re seeing many homes that were flooded in Harvey re-entering the market at substantially reduced list prices. From our experience, most buyers are still avoidant of pre-flooded homes. However, we’re now seeing flooded homes selling for as much as 30-40% below pre-flood value, and this is beginning to have an effect on the pricing of non-flooded homes, as market supply is rising.
Finally, another factor adding to the market slow down in Houston is a reduced cost of rental rates. Prior to Harvey, there was an oversupply of rental units, and since Harvey it’s balanced out. However, we’re facing downward pressure on the market again. There’s several apartment complexes still under construction, especially inside the loop. Many complexes are offering 3 months free and other incentives to fill the vacancies. Buyers that are on the fence are incentivized to wait.
Overall, from a buyer’s perspective, we are definitely seeing downward pressure on prices. Low ball offers are being accepted more and more as supply increases and demand drops. Historically, October is by far, one of our best months, which means we have quite a few contracts go into place in September. This September has not been reflective of that. During times like this, it’s a great opportunity to submit and win low offers, especially with homes that have been on the market for a while.
Are you a buyer searching in this Houston market? We specialize in working with people just like you! Call us at 713.364.4003 to talk with one of our top notch agents.