Texas home sale volume declines during second quarter

Home sales in Texas declined on a yearly basis.The most recent Texas Quarterly Housing Report revealed a downward trend for the state's real estate sector, which still appears to be overshadowed by 2010's federal homebuyer tax credit.During the second quarter of 2011, the volume of single-family home sales totaled 58,795, which is 12 percent lower than the same period in 2010, according to the Texas Association of Realtors. However, last year's figure was skewed by the tax credit issued to first-time homebuyers, which boosted sales.”Though statewide sales volume is down compared to 2010, when the tax credits were having the biggest impact on our market, we're right on pace with the second quarter of 2009,” said Dwight Hale, TAR chairman. “In addition, Texas has dominated national headlines for economic strength, which makes it clear the recovery continues in our state.”Jim Gaines, an economist at Texas A&M University, agreed with Hale's assessment of the quarterly report.”Given the impact of last year's tax credits, I'm not surprised to see fewer sales this quarter compared to last year,” Gaines said. “If anything, I'm surprised to see that sales volumes didn't lag further behind 2010.”Despite the lower volume of sales, the state's median home price increased 1 percent from the same period in 2010, growing to $150,400. The average price also escalated, climbing 4.6 percent from last year to $201,288.”The increase in the average price of Texas homes indicates more activity among higher priced homes,” Gaines explained. “Buyers of higher priced homes have been less impacted by tightened mortgage lending standards and real estate has been an attractive investment vehicle due to instability in other investments, such as securities.”The state's inventory of available properties settled at 8.1 months during the quarter, which is up 12.5 percent from last year, when the total reached 7.2 months. Gaines explained that additional inventory has entered the market this year, as a higher number of foreclosures have taken place. He stated that the current inventory is beyond what experts consider to be normal.The Houston real estate market somewhat reflected the state's trends, as both the average and median price increased during June, growing by 3.7 percent and 2.2 percent, respectively. However, home sales in the city grew 0.6 percent when compared to the previous year.Courtesy of 2M Realty News

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