Texas Housing Market Rebounds as Buyers Take Advantage of Low Interest Rates
published on October 23, 2020
Texas existing home sales increased 10.7 percent in September 2020 compared to August 2020 and were about 2.6 percent higher than the first three quarters of the year, according to the Real Estate Center at Texas A&M University, which cited homebuyers rushing to take advantage of historically low mortgage rates.
“Many prospective homebuyers who were planning to purchase next year have been pulled into the market early as their affordability has suddenly improved,” said Real Estate Center Chief Economist Dr. James Gaines. “This pull factor contrasts the pent-up demand that drove the summer sales surge.”
Nationally, existing-home sales in August 2020 increased 9.4 percent compared to August 2019, according to the National Association of Realtors®, but first-time buyer totals notched down two percent, perhaps due to pandemic-related economics. “Loan-to-value and debt-to-income ratios are falling, while credit scores for qualifying applicants are rising as lenders acknowledge the current state of economic uncertainty,” said Gaines.
Real Estate Center Research Economist Dr. Luis Torres said, “Texas’ real income per capita increased 8.1 percent year over year during the second quarter, explaining much of the housing markets’ resiliency.” However, it was noted this is due at least in part to government-sponsored fiscal and monetary policies.
Low housing supply continued to be a challenge to the market, with September inventory dropping to 2.1 months for the state, with lower inventories in the big cities. The Real Estate Center posted that new home listings have not “kept pace with the sales rebound, diminishing housing inventories that were already at record lows.”
High demand and low supply pushed Texas home prices up a double-digit percentage from last September to around $260,000.
Austin Home Price Estimate
What's your home worth? Use our instant home price estimator to get an idea of what your home might sell for on the market today.