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COLLEGE STATION, Tex. (Texas Real Estate Research Center) – Texas' existing-home sales were almost flat in June increasing just 1.6 percent over May to 27,000 transactions. Experts say the sales trend is slowing amid constrained inventories.

“Mortgage rates are still hovering around 3 percent, and ongoing demographic trends continue to support housing demand," said Dr. Luis Torres, research economist for the Texas Real Estate Research Center at Texas A&M University.  

The average Texas home stayed on the market for just 26 days, the shortest time since the Center began keeping records in 1997.

According to the National Association of Realtors (NAR), national existing-home sales rose moderately in June, rebounding slightly from a four-month slide. Along with the 1.4 percent monthly increase, national sales were up 22.9 percent from last year.

“Standard year-over-year (YOY) calculations should be viewed cautiously due to the effects of the pandemic in June of last year," said Torres.

Along with a June increase in sales, a 9.2 percent increase in new listings pulled Texas' months of inventory of existing homes to 1.3 months.

“It appears the persistent low level of inventory is easing as more homes hit the market," said Torres. “However, the limited inventory for homes priced less than $300,000 is particularly distressing and is putting pressure on home affordability."

While reaching an all-time high, Texas' median existing home sales price fell 19.3 percent YOY to $298,000. NAR reported an annual national increase of 23.4 percent to $363,300.

Torres said a shift in the composition of sales toward higher-priced homes due to limited inventory at the bottom price cohorts explains some of the increase in the median sales price.

“Our Texas Repeat Sales Home Price Index accounts for this compositional bias and indicates annual home-price appreciation was closer to 15 percent in June. Although less extreme than the median price metric suggests, the rise in home prices is still impairing Texas housing affordability."

Read more about the Texas Real Estate Research Center's predictions of economic activity.

Funded primarily by Texas real estate licensee fees, the Real Estate Research Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers, and the public. The Center is part of Mays Business School at Texas A&M University.​

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COLLEGE STATION, Tex. (Texas Real Estate Research Center) – Winter Storm Uri was a harsh reminder of the importance of homeowner's insurance. A study by the Texas Real Estate Research Center at Texas A&M University shows households that are low-income, in nonmetropolitan areas, or without a mortgage are less likely to have homeowner's insurance.

Researchers used U.S. Census Bureau data to estimate the number of uninsured Texas households. Approximately 26.6 percent of nonmetro homeowners reported as uninsured. Eleven percent of households in metropolitan areas with a principal city such as Austin, Dallas-Fort Worth, Houston, and San Antonio are uninsured. In metropolitan areas without a principal city, 10.2 percent do not have homeowner's insurance.

“Metropolitan areas in the Rio Grande Valley and along the Texas coast have the highest percentages of uninsured households,“ said Joshua Roberson, senior data analyst. “In McAllen, almost two out of five households are uninsured. Brownville is close behind with 34.9 percent.

“Despite being vulnerable to hurricane damages, one out of five homeowner households in Beaumont and Corpus Christi is uninsured."

“Mortgage status plays an important role in determining the likelihood of having property insurance because mortgage contracts require a homeowner's insurance policy," said Research Economist Luis Torres. “The mortgage lender has a financial interest in the home, which is motive for requiring insurance.

“Only 4.1 percent of homeowner households with a mortgage are uninsured. This is in contrast to 26 percent for those who own their home free of debt."

The study notes the relationship between having lower average income and being uninsured. Those who own their home free and clear of debt and are uninsured have incomes around $53,274 compared with $95,873 for those who own their home and are insured.

The smallest percentages of uninsured households can be found in Austin and Dallas-Fort Worth at 6.1 and 7.4 percent, respectively.

“Homeowners who don't have a mortgage are generally characterized as seniors living in older homes, which are more susceptible to damage from extreme weather conditions," said Torres.

“When one considers the link between household income levels and being uninsured, this raises important questions. Is homeowner's insurance too expensive for households earning a lower income? Is the cost impeding them from protecting their homes from natural disasters?

“Identifying the location and characteristics of uninsured homeowners would enable the state to better allocate resources for home repairs following a natural disaster such as a freeze."

For more, read “Storm Warning: Winter Blast a Harsh Reminder of Need for Homeowner's Insurance" on the Texas Real Estate Research Center website or in the summer issue of TG magazine.

Funded primarily by Texas real estate licensee fees, the Texas Real Estate Research Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers, and the public. The Center is part of Mays Business School at Texas A&M University.

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Thousands of pages of data are available at the Center's website. News is also available in our twice-weekly electronic newsletter RECON, our Real Estate Red Zone podcast, our daily NewsTalk Texas feed, on Facebook, on Twitter, on LinkedIn, and on Instagram. To request a free press subscription to our quarterly flagship periodical TG magazine, contact David Jones at the e-mail address indicated.

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“A feverish demand for land, accompanied by a dearth of listings for sale, propelled Texas prices up a remarkable 16.29 percent in the second quarter," says the land expert for the Texas Real Estate Research Center (TRERC) at Texas A&M University.

“The state's land markets today are among the most active periods in Texas history," says Dr. Charles Gilliland, TRERC research economist who's been tracking land prices for 40 years.

Preliminary numbers show Texas had an annualized 8,561 second quarter land sales, up nearly 43.8 percent over the same quarter last year. The statewide average price hit $3,433 per acre. Total dollar volume totaled a record $2.35 billion, 93 percent higher than second quarter 2020.

A record annualized 685,585 acres changed hands in the second quarter. The typical transaction size fell 4.78 percent to 1,176 acres.

“The East Texas regions all had double-digit price increases with substantial increases in total acres transferred," said Gilliland.

Only the Far West Texas Region bucked the Texas trend. Out west, land sales volume dropped 22.6 percent, which Gilliland attributes to a sudden halt in purchases from the oil and gas industry. Sales in the West Texas mountains, however, helped keep regional prices higher.

Official numbers will be available in August, but Gilliland says, “This explosion in sales volume shows the flight of buyers to rural environments continues in these uncertain times."

Source: Texas Real Estate Research Center

​Funded primarily by Texas real estate licensee fees, the Texas Real Estate Research Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers, and the public. The Center is part of Mays Business School at Texas A&M University.

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Thousands of pages of data are available at the Center's website. News is also available in our twice-weekly electronic newsletter RECON, our Real Estate Red Zone podcast, our daily NewsTalk Texas feed, on Facebook, on Twitter, on LinkedIn, and on Instagram. 

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COLLEGE STATION, Tex. (Texas Real Estate Research Center) – Production of manufactured homes accelerated in June according to the latest Texas Manufactured Housing Survey (TMHS), contributing to increased business activity. Plant activity chipped away at backlogs that bottled up over the past year amid moderating sales volume.

“Backlogs started to ease for some manufacturers in June, but time will tell if that trend persists through July," said Rob Ripperda, vice president of operations for the Texas Manufactured Housing Association (TMHA). “Production days are reduced by Independence Day, and the summer sales season continues on retail lots."

Manufacturers expanded payrolls to boost activity, but hiring was hindered by on-going labor-supply challenges that drove wages and incentives upward. Survey respondents expect labor-market conditions to improve over the next six months.

In addition to hiring wages and salaries, rising prices for raw materials continued to drive up the cost of production. The TMHS corroborated inflationary pressures, but the rate of price increases slowed slightly.

“Manufacturers are experiencing some relief in lumber prices after a 40 percent decline in June," according to Dr. Harold Hunt, research economist at the Texas Real Estate Research Center at Texas A&M University. “Lumber prices, however, are still almost twice as high as they were last year."

Supply-chain disruptions continued to hinder operations and contributed to higher prices.

“Shortages in many other building components, especially those involving the use of chemical resins such as siding and shingles, are negatively impacting the construction process," said Hunt.

These challenges weighed on industry optimism, but the outlook for Texas' manufactured housing industry remains favorable for the rest of the year.

Funded primarily by Texas real estate licensee fees, the Texas Real Estate Research Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers, and the public. The Center is part of Mays Business School at Texas A&M University.

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Thousands of pages of data are available at the Center's website. News is also available in our twice-weekly electronic newsletter RECON, our Real Estate Red Zone podcast, our daily NewsTalk Texas feed, on Facebook, on Twitter, on LinkedIn, and on Instagram. To request a free press subscription to our quarterly flagship periodical TG magazine, contact David Jones at the e-mail address above.​

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COLLEGE STATION, Tex. (Texas Real Estate Research Center) – Texas' existing-home sales increased 2.5 percent month over month (MOM) to 29,000 transactions in May but remained more than 2,000 sales below peak levels reached at the start of the year.

The average home stayed on the market for just one month, a record-low duration since the series started in 1997.

“Mortgage rates are still hovering around 3 percent, and ongoing demographic trends continue to support housing demand," said Dr. Luis Torres, research economist for the Texas Real Estate Research Center at Texas A&M University. 

According to the National Association of Realtors (NAR), national existing-home sales fell for the fourth straight month in April. Despite the 1.2 percent MOM decline, activity exceeded pre-pandemic levels and increased 46.2 percent from the pandemic's trough last May.

“Due to the fact that much of the pandemic's worst impacts registered in April and May 2020, standard year-over-year (YOY) calculations should be taken with a grain of salt," cautioned Torres. “For example, Texas resale transactions skyrocketed more than 50 percent YOY in May but rose 14.7 percent relative to May 2019 levels."

Compared with two years ago, existing-home sales elevated just 8.1 percent nationally.

Along with a monthly pickup in sales, a 3.1 percent decrease in new listings during May pulled Texas' months of inventory to 1.1 months in the state's existing-home market.

“The extremely low level of supply available is holding back sales," said Torres. “The limited inventory for homes priced less than $300,000 is particularly distressing and is stressing home affordability."

Texas' median existing home sales price accelerated 27.8 percent YOY to $289,900. NAR reported an annual increase of 21.5 percent to $306,000 in the national metric.

Torres, however, said that a shift in the composition of sales toward higher-priced homes due to limited inventory at the bottom price cohorts explains some of the increase in the median sales price.

“Our Texas Repeat Sales Home Price Index accounts for this compositional bias and indicates annual home-price appreciation was closer to 15 percent in May. Although less extreme than the median price metric suggests, the rise in real home prices is still impairing housing affordability within Texas."

Read more about the Real Estate Research Center's predictions of economic activity.

Funded primarily by Texas real estate licensee fees, the Texas Real Estate Research Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers, and the public. The Center is part of Mays Business School at Texas A&M University.

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Thousands of pages of data are available at the Center's website. News is also available in our twice-weekly electronic newsletter RECON, our Real Estate Red Zone podcast, our daily NewsTalk Texas feed, on Facebook, on Twitter, on LinkedIn, and on Instagram. To request a free press subscription to our quarterly flagship periodical TG magazine, contact David Jones at the e-mail address above.​

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