The housing boom hasn't gone bust, but it's definitely more like a crackle or a pop these days. Thanks to rising prices and lower supply, the real estate market has made a noticeable slowdown in recent months. According to a new report by the National Association of Realtors, pending home sales fell by 4.7 percent in January compared with December. At the same time, rising interest rates have made new homes that much more expensive, especially for first-time buyers. The rate on a 30-year mortgage is up nearly a half-percentage point, from 3.95 percent to 4.43 percent, just since the start of this year.
Houston's housing market has largely withstood any national headwinds in recent years, thanks to our booming local economy and strong demand. And according to Michael Weaster with Houston's Berkshire Hathaway Real Estate, not much has changed here. "Everything is just about staying steady right now," he tells KTRH. "Everybody is still worried about all of these flooded homes (from Hurricane Harvey) and how that's gonna shake out, so right now everything looks normal."
That isn't to say that rising interest rates and dwindling supply aren't having an effect on prices here, just like the rest of the country. "It is difficult for your normal, average working guy to get a loan...prices are going up, up and up," says Weaster.
Regardless of the interest rate hikes, Weaster believes the national housing market was overdue for a downturn after years of steady growth. "Every expert says it should have been seven or eight years, and instead it's been longer than that...we're working on ten years of steady increase, so we were expecting a correction," he says.
The bottom line, according to Weaster, is that despite the tightening in the market, the building boom continues and there is still plenty of demand in the Houston area. "It's a good time to buy and sell," he says. "You know, when I put listings on the market I do get multiple offers still...buyers are out there buying."