The Texas real estate climate continues to be better than the national market, as the sales of Houston foreclosures continue to be lower than average.
According to RealtyTrac (http://www NULL.realtytrac NULL.com/content/press-releases/2010-year-end-and-q4-foreclosure-sales-report-6402), foreclosure sales are 25.96 percent of all home sales nationwide. The average for the state of Texas is 12.88 percent. This is reassuring for prospective Houston-area residents, as it may show the housing market improving in the area.
Despite this, the national average is still struggling. James J. Saccacio, chief executive officer of RealtyTrac said that while foreclosures are still prevalent, they continue to sell for less than the average price. With less consumer demand, market will be sluggish.
Saccacio added, "The catch-22 for 2011 is that while accelerating foreclosure sales will help clear the oversupply of distressed properties and return balance to the market in the long run, in the short term a high percentage of foreclosure sales will continue to weigh down home prices."
Texas’ numbers are far lower than some other states. For example, foreclosures made up 57 percent of sales in Nevada.Foreclosure sales in Houston are actually more common that the rest of the state. According to the Houston Association of Realtors, they made up more than 20 percent of local home sales in January.
Texas foreclosure sale rates below the 2010 national average
Report: Foreclosures on Houston homes down
The number of houses in Houston being successfully foreclosed at a recent auction in Harris County dropped, even though more properties were listed than last month, Foreclosure Information and Listing Service told the Houston Business Journal.
On a yearly basis, the 747 properties which were foreclosed during the group's auction earlier this month represents a nearly 16 percent decline from February 2010, which saw 887 Houston homes headed to the block, the publication said, though it added that there was a 5 percent increase in the number of commercial and residential properties listed for foreclosure last month.
Since most homeowners manage to get caught up on their mortgage payments before their property is actually foreclosed, the Business Journal said, the number of homes auctioned off is almost always a lot smaller than the number listed.
It seems, then that a canny Houston property buyer may still be able to find a deal at a foreclosure auction, but the long-term trends in the area's housing market indicate a transition to more growth and stability in the future.
Report: National home prices drop, but changes in patterns are seen
Purchase prices for U.S. homes dropped by 3.9 percent in the fourth quarter of 2010, according to research released this week by S&P/Case-Shiller, but some large urban markets began to exhibit different trends.
The chairman of the company's index committee, David Blitzer, said in a statement that the trajectories of some major housing sectors have begun to diverge.
"Unlike the 2006 to 2009 period when all cities saw prices move together, we see some differing stories around the country. California is doing better with gains from their low points in Los Angeles, San Diego and San Francisco. At the other end is the Sun Belt – Las Vegas, Miami, Phoenix and Tampa. All four made new lows in December," he said.
Although Houston real estate was not specifically studied in the report, experts say the general trend for the area is good. Other recent studies – while not revealing any skyrocketing property values – showed generally positive movement and definite signs of an ongoing recovery from the housing crash.
Harris County population growth could mean higher values for Houston real estate
Between 2000 and 2010, Harris County, Texas, has seen a 20 percent population increase, according to the U.S. Census Bureau, meaning that more housing is needed to shelter the extra residents. The county had 3,400,578 residents in 2000 and 4,092,459 in 2010, the government's figures said.
A former Census Bureau director and current demographer at Rice University, Steve Murdock, told the Fort-Worth Star Telegram that Texas has been a huge part of the growth of the U.S. population over the past decade.
"It has been a phenomenal run for Texas. Texas grew by nearly 4.3 million out of 17 million in the country; that's almost a quarter of the total growth of the nation," he said in an interview.
The Hispanic population increased at a greater rate than any other ethnic group, up nearly 50 percent in the Houston area.
Experts say the rapidly growing population will provide opportunities as well as challenges to the city's real estate market, pushing housing demand higher and causing a possible rise in average Houston home prices.
Study finds fewer homeowners heading for foreclosure
Credit demand and the rate of delinquency in mortgage loans fell off at the end of 2010, according to TransUnion, marking the fourth consecutive quarter in which those statistics moved in a positive direction.
However, a slowdown in the rate at which delinquency rates dropped is a concern, according to TransUnion group vice president of the U.S. housing market Tim Martin.
"Although the increase in January's consumer confidence index is good news for the consumer as well as the fourth quarter GDP number of 3.2 percent, real estate prices …. have been consistently falling since the end of second quarter. What we hoped was a temporary third quarter price adjustment due to the ending of the home buyer tax credit appears now to be more systemic," he said.
For those interested in Houston real estate, it may be encouraging to learn that TransUnion's data shows the state delinquency rate at 5.19 percent, below the national average of 6.44 percent.
The continued stabilization of the market, overall, must still be considered good news for real estate professionals, other analysts say.
Survey: Nearly three in four Americans want to own their home
Home ownership is a part of the American dream for almost three quarters of the respondents to a recent Trulia poll, the company announced recently.
The poll, conducted by Harris Interactive on Trulia's behalf, found that 70 percent of Americans felt that their personal concept of the American dream included owning their own house, and 78 percent of those who already own their dwellings say they are the best investments they've ever made.
Trulia says that one of the most significant findings of its study is the apparent centrality of Millennials to the upturn in the housing market, with almost nine out of 10 renters between the ages of 18 and 34 saying they were interested in owning their own homes.
Tara-Nicholle Nelson, Trulia's head of consumer education, said the trend was encouraging.
"Unjaded and largely untouched by the effects of the housing crash, this new generation of buyers will no doubt lead America from its current housing slump towards true recovery," she said.
Different areas will no doubt recover at varying speeds, experts point out, as Houston condos – for example – will be sold far differently than rural Texas ranch houses.
New Year brings good news for Houston real estate
Statistics tracked by the Houston Association of Realtors rose almost across the board in January 2011, as signs of the recovery's continued health continued to appear, the group said in a statement.
The city saw its first monthly increase in property sales since June 2010, according to HAR's report, and the average price of a single-family home hit its highest January level on record, driven primarily by strong numbers in the luxury housing market. However, the group also noted that surges in volume were seen among all home price levels, from a 26.3 percent rise for homes below $80,000, smaller but still notable gains for those between $80,000 and $500,000, and a 17.6 percent spike for those in the $500,000-and-up range.
HAR chairman Carlos Bujosa said the study should give Realtors in the area reason for cautious optimism, since it appears that the market may be continuing to move back toward where it was before the housing crash.
"Houston's residential real estate market has definitely gotten the new year off to a healthy start. Housing inventory appears to be balancing out, but the economy as a whole remains somewhat fragile, so I believe we need to see how home sales perform in the next month or two before being able to accurately predict what 2011 has in store for us," he said.
Year-over-year, the statistics were also strong, HAR said, as single-family home sales were 7.5 percent higher in January 2011 than in the same month of 2010. The mean average home price also rose over the course of 2010, according to HAR, up 2.2 percent to $196,879.
The increase in home purchase volumes seen in January 2011, the group notes, is the first that cannot be directly attributed to the effects of the federal government's tax breaks for homebuyers, instituted in the hopes of stimulating the troubled housing market. Those ended at the same time as the last monthly gain.
The median cost of a single-family home in Houston was $139,000, well below the national median of $169,300. This indicates that costs of living in the area are lower than average and that homebuyers in Houston may be able to get more bang for their buck than in other places, HAR said.
Report: Mortgage rates rising in many categories
Statistics released recently by government-backed mortgage giant Freddie Mac indicate that rates for home loans are steadily increasing across the board, indicating a possible revival of the market.
The average rate for 30-year fixed-rate mortgages spiked from 4.81 percent at the beginning of February to 5.05 percent ten days in, according to Freddie Mac. The current rate is also higher than the same measurement taken a year ago, the company adds.
The rates, according to Freddie Mac vice president and chief economist Frank Nothaft, are the highest they have been since last April.
"Long-term bond yields jumped on positive economic data reports, which placed upward pressure on mortgage rates this week. For all of 2010, nonfarm productivity rose 3.6 percent, the most since 2002, while January's unemployment rate unexpectedly fell from 9.4 percent to 9 percent. Moreover, the service industry expanded in January at the fastest pace since August 2005," he said, detailing some of the reasons behind the change.
Houston real estate, like property around the country, could command increased prices despite still-strong sales, experts say.
Houston property owners could be affected by new city initiative for green tech
A new program in Houston designed to encourage property owners to improve the energy efficiency of their buildings will offer incentives for some types of renovation, Mayor Annise Parker announced this week.
"The Energy Efficiency Incentive Program is an unprecedented opportunity for commercial building owners and managers to actively engage in the city-wide sustainability strategy – to make Houston a greener, cleaner and healthier place for ourselves and future Houstonians. The energy efficiency projects completed as part of this program will …. help buildings achieve their sustainability goals," she said in a statement.
City government will commit $3 million in seed funding to environmentally motivated improvement projects. If an approved engineering estimate finds that a given renovation will result in at least a 15 percent savings in energy costs, Houston will make anywhere from $20,000 to $200,000 – up to 20 percent of the improvement's total cost – available to the property owner.
In addition to the city incentives, property owners should consider the savings on energy costs by themselves. The difference between unmodified old buildings and new renovations can be startling, experts say.
Home prices in America changing, but general trend is good
Several years after the onset of the economic downturn prompted by a housing crash, that market sector may be in the process of recovering value, according to a study from analysis firm CoreLogic.
That company's state-by-state data show that Idaho homes are losing value more quickly than the rest of the nation, down more than 10 percent in 2010 even without taking distressed home sales into account. On the other end of the spectrum, Hawaii posted a 6.15 percent gain in value according to the same metric, though North Dakota takes the top spot if distressed sales are included.
For Houston homes, the news from CoreLogic is generally good, as single-family home prices saw a minor upward shift of 1.8 percent including distressed sales, or 0.51 percent if they were excluded.
The company said that the national trend, despite the wide variation, evened out almost completely, though this does mark a halt to the sliding values that have been seen in recent years. Keeping track of variations by area could let astute homeowners get a better deal than they may have otherwise.
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