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Sales of single-family homes rebounded in October, a sign that higher mortgage rates may be compelling Houstonians to buy before rates go even higher, the Houston Association of Realtors reported.
After dipping in September, home sales in the Houston area rose 4.7% from a year earlier to 6,716 homes. The median price rose to of $234,653 last month, up 3.6% from October 2017.
“When mortgage rates click up a little bit it stirs people to say, ‘Oh, I better go buy,'” said Charlie Neath, an agent with John Daugherty Realtors.
September sales fell 7.4% from the previous year, although the figures were skewed by Hurricane Harvey, which hit in late August of 2017 and pushed that month’s closings into September.
“October seemed to mark a return to normalcy in terms of overall market activity,” Kenya Burrell-VanWormer, chair of the Houston Association of Realtors, said Wednesday in the association’s monthly report. “However, we are prepared for slower sales as we wrap up 2018, between the tight supply of homes and the fact that we typically see less activity around the holidays.”
Inventory fell below 4 months in October, indicating the market remains more favorable to sellers, though each neighborhood is different.
The average 30-year mortgage rate was 4.94%, according to the latest weekly survey from Freddie Mac, the government-sponsored mortgage finance company. That’s up from 3.95% at the beginning of the year.
Sales were up among all price segments, except for homes priced at $150,000 and below. The strongest segment was the luxury market — homes priced at more than $750,000 — where sales rose 12% from the previous October.
Despite October’s gains, rising mortgage rates represent a threat to the housing market as buying power declines the higher rates go, but 2018 is still shaping up as another record year for real estate agents. Homes sales in the first 10 months were running 5.3% ahead of the same period in 2017, which had record sales.
Tribune Content Agency