May home sales surge for Houston region, Montgomery County

Closed Sales May 2012-2013The county and the Houston region continued to blow out previous home sales records as the area’s strong economy, job and population growth fuel continued demand for housing.

May 2013 marked the second-best month for home sales in Montgomery County ever, with 911 homes sold; that is second only to June 2006, when 929 homes were sold during the market peak. It was the highest number of homes sold in May in Montgomery County ever, compared even with the market peak in 2006.Closed Sales YTD May 2013

The monthly sales represented a 23 percent increase over May of last year; that compares well with Houston, which saw a 28 percent growth in sales in May, year over year.

Montgomery County has seen nearly two years – 20 consecutive months – of positive sales each month over previous years. Houston has experienced 24 straight months of positive growth.

It all adds up to a dynamic housing market that gives no signs of slowing, despite modest increase in interest rates recently, according to Houston Association of Realtors Chairman Danny Frank with Prudential Anderson Properties.

“The Houston real estate market has held to positive territory for two years running and you’d be hard-pressed to find a market anywhere in the U.S. as vibrant as ours,” Frank said. “We continue to see multiple offers on homes, in many cases before the ink has even dried on the listing agreements. There are also many cash offers. We need to carefully watch pricing, however. A disproportionate appreciation in home prices could suggest a bubble, and Houston is very fortunate to have avoided that so far.”

Houston’s and Montgomery County’s relentless surge in home sales continues to be fueled by further job creation, according to HAR, with the Texas Workforce Commission reporting the addition of more than 111,000 jobs over the past 12 months. Continued low interest rates have also made conditions more appealing for home buying, although rates have begun creeping up in recent weeks.

Median Price YTD May 2013The patterns of growth in sales, decreasing inventory, and median prices have been favoring The Woodlands, Conroe and southwest Montgomery County, but southeast Montgomery County and the Lake Conroe area saw the strongest increase in closed sales in May, and also year-to-date now. The two regions also lead in May with increases in median price; although year-to-date The Woodlands and southwest Montgomery County, followed by Conroe northeast, continue to see the strongest price appreciation, with gains in median prices of 9.1 percent and 8.5 percent, respectively.

All of this growth in sales of course eventually will have an impact on the availability of housing and the pace of sales.

                       

Days on Market YTD May 2013

                                                                                                                The average Days on Market (DOM) fell in each of the four regions of Montgomery County, with the stro

ngest declines being in what have been the two strongest markets, The Woodlands/southwest and Conroe/northeast. In The Woodlands/southwest, the average DOM now stands at 56 days.

Months of Inventory June 2013The amount of remaining inventory continues to drop as well. In The Woodlands/southwest, the remaining months of inventory available has fallen to just 2.5 months.

The only negative to be found in all of the data is the number of closed sales in southeast Montgomery County – there has been a decrease for that region both for May compared to last year, and for year to date.

Still, with all the pressure on growth – and the coming development of the latest segment of the Grand Parkway, passing along the south part of the county from near the Exxon/Mobil complex to U.S. 59 – it’s hard to believe that southeast Montgomery County won’t see a surge in sales eventually as well.

 

The Top 10 fast-selling areas in Montgomery County; location, location, location

 

Top 10 fast sellers April 2013 

One clear sign of the strength of home sales in any particular area, and where the market is likely to heat up even more next, is in the average Days on Market for homes.

Clearly, Montgomery County is now a “seller’s market,” defined as a housing market in which the existing inventory of homes is 5 to 6 months or less (the time it would take, given the existing pace of sales, to absorb all of the existing homes on market).

But Montgomery County is not uniform by any means, and housing sales are driven by any number of factors. The quality of area schools, the quality of construction, the availability and quality of area amenities, and proximity to jobs are all major factors that will drive home sales.

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And one measure of the strength of those sales is the Days on Market. After analyzing the Days on Market for the geographical market areas used by the Houston Association of Realtors MLS, I have determined the “Top 10 Fastest Selling Areas” in Montgomery County for April 2013. Go here for a chart showing the entire list, plus the number of sales in each area.

The graphic shows the Top 10. What makes these communities so popular? A look at the top 5 helps explain:

  1. The Woodlands – The Woodlands is the hottest market for real estate right now in Montgomery County. Homes are listed and sold literally in days in some cases. The reasons are obvious. The Woodlands boasts quality schools, fantastic area amenities including Market Street, great neighborhood parks, golfing and miles of hiking and biking trails and proximity to Interstate 45 and the Exxon Mobil campus currently under construction. At 12 Days on Market on average for April, homes have become a precious commodity in The Woodlands.
  2. Spring Northeast – Spring Northeast is No. 2 in our ranking, and it is driven by quality subdivisions like Imperial Oaks and Bender’s Landing, the community of Oak Ridge north, and proximity to I-45.
  3. Conroe southeast – At No. 3, the southeast area of Conroe – featuring custom home subdivisions like River Plantation and Crighton Ridge, is narrowly behind Spring Northeast in Days on Market. Again, proximity to I-45 is a key driver.
  4. Magnolia FM 1488 east – Home buyers here are drawn by the promise of spacious homes on large lots, a place in the country that still is not too far thriving areas like The Woodlands and thoroughfares like Interstate 45.
  5. Lake Conroe area – Lake Conroe is one of Montgomery County’s claims to fame, and a wide variety of lake area communities afford homeowners the best of both worlds, a lake area lifestyle, with city amenities just down the road.