The coronavirus pandemic has hammered much of the economy over the past year, but one sector has thrived and continues to: housing. The final numbers for December reflect a banner year for residential real estate, both nationwide and here in the Houston area. "In the U.S., total single-family housing sales were up 5.6 percent last year, the best in 16 years, but in Houston we were almost double that--10.5 percent, the best in history," says Ted C. Jones, chief economist with the Stewart Title Company in Houston. "So, we are looking at a very robust, strong market."
The Houston housing market has been thriving for months, despite the economic downturn from the pandemic and weak oil prices for most of the past year. "You can argue that housing was one of the sectors that kind of pulled us out of that recession in the first two quarters," says Jones.
The only negative metric in the December numbers was pending home sales contracts, which were down 0.3% month-to-month, and have declined for four straight months. But Jones explains that is only because of the lack of available homes on the market. "If you don't have anything to sell, you can't sell it," he says. "In December, we were looking at 1.9 months of inventory, and we think six months of inventory is normal...so we were at a little less than one-third of normal."
As a result of this hyper demand and low supply, home values have skyrocketed in recent months. Jones chalks up much of that demand to the pandemic, which had people staying home more and making home a much bigger part of their lives. He expects that demand will decline as the pandemic subsides. "With every vaccine shot, the intrinsic value (of our home) goes down, because it allows us to get away from our home a little more," says Jones. "We won't depend as much on our home for our lifestyle after the pandemic is over."