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Texas home prices continue to climb despite COVID-19 impactTexas home prices continue to climb despite COVID-19 impacthttps://www.recenter.tamu.edu/news/newstalk-texas/?Item=248812020-09-10T05:00:00Z2020-09-10T16:00:00Z

​​​​​COLLEGE STATION – The latest Texas Home Price Index (HPI) shows home prices increased 4.18 percent year over year in July. Real Estate Center Senior Data Analyst Joshua Roberson called this "a welcome sign among a bevy of pessimistic economic indicators."

"Home prices in general so far have trended counter to the negative pressures brought on by COVID," he said. "After years of gradual decline from lofty price-growth heights, prices somehow managed to reverse that trend in 2020."

Texas Monthly Home Price Index YOY change

Roberson said the reasons for this are not complex.

"At least two factors are at play," he said. "First, bottomed-out mortgage rates have sustained interest in housing. Second, an even greater bottoming out of housing supply has produced a fiercely competitive market for those eligible to play."

Roberson said the demand pool looks a lot different this year than last year, with greater concentrations of consumers with overall higher credit profiles and stable income and asset resources. The housing supply pool looks different as well. Homes in the $100,000s account for fewer of homes available to buy, while more homes in the $300,000s are taking their place.

"Perhaps what’s more remarkable is that the HPI is increasing despite this shift," he said. "Typically, homes in the lower-priced tiers contribute most to local price growth when the market is tight. Currently, though, it’s the mid- and higher-priced homes."

July marked the end to numerous federal protections, including the CARES Act, that impact homeowners and renters. The status of these protections is, for the most part, still up in the air. Roberson said whether the home price-growth trend continues will depend largely on those protections, the economy, and, perhaps most importantly, virus mitigation progress.

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​Source: Real Estate Center
Real Estate Center
Texas
Housing
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