After two years of choppy waters in the Houston housing market due to high interest rates, low supply and see-sawing prices, there may be room for optimism in 2025. The latest report from the Houston Association of Realtors (HAR) shows a 1.2% decline in the median home price in February, along with an increase in supply of homes available. At the same time, the average on a 30-year, fixed-rate mortgage fell to 6.7%, a five-month low. "These numbers indicate more of a balanced market for us," says Theresa Hill, HAR Chair-Elect. "And definitely leaning toward a buyers' market."
The market seems to reflect that more buyer-friendly sentiment, as mortgage applications in the Houston area have risen by 31% in the past year. Hill credits the increase in supply. "Back in February 2024 we had about three months of inventory, and this February we were at four months of inventory," she tells KTRH. "So all of these factors are going to play into that advantage as a buyer."
But not all of the news is positive. Total home sales in the greater Houston market were down 3% in the past year, and despite the median home price falling to about $325,000, the average price was up by more than 2% to around $407,000, driven largely by luxury home prices. "This was the first decline (in sales) that we've seen in six months," says Hill. "And some of that is just due to the math of there being more homes available."
Still, now appears to be the best time to buy since just after the pandemic. "And if (interest rates) continue to decline, I think we're going to see more buyers come to the market," says Hill.
Photo: Getty Images North America