REC report: Housing demand strong, but home shortage limiting growth

​​​COLLEGE STATION – The Real Estate Center’s latest monthly Texas Housing Insight​ report shows the state’s economy supported strong housing demand, but the shortage of homes, especially those priced below $300,000, limited overall growth.

According to the report, home sales rose half a percent and were flat on the year. Inventory levels showed signs of relief as new listings came to market, but structural supply issues persisted. Homebuilders grappled with increased land, labor, and lumber costs, as well as increased regulations. However, the recent inventory uptick moderated home price appreciation after years of outpacing income growth.

Single-family private construction values fell 5 percent, pulling year-to-date (YTD) growth into negative territory. Construction values dropped 9.1 and 15.8 percent YTD in Dallas-Fort Worth and San Antonio, respectively, followed by Austin at 3.1 percent.

Houston’s single-family construction values bounced back after a slight hiccup last month, bringing YTD growth into double digits (10.3 percent). The report said local developers may be accelerating activity ahead of stricter building regulations set to take place in Houston later this year.