Boom or Bust: How the Exploding Housing Market in Houston is Complicating Matters for Buyers and Sellers
We never expected to find a home as quickly as we did. When my fiancée and I started looking, we assumed we would casually search until after our wedding in October, then get serious. But as we watched interest rates slowly begin to tick upward, we decided to speed up the process. Even then, we assumed it would take weeks or months to find a home. How could we have known it would only take one day?
Photo by Sarah de la Rosa
The Houston housing market is booming. In the last year, home sales have shot up by 28 percent and prices have risen by 11 percent as of May. The combination of low interest rates (they are still historically low despite rising over a point in the last two months) and still relatively low housing costs compared to most of the country -- nevermind a steadily growing economy and a rebound from the housing bubble of 2008 -- are sending prices and sales higher than ever. But, this is fueling concerns over the return of a housing bubble.
Real estate website Trulia recently reported that homes in Houston were as much as 2 percent over-valued in the current market, but cautioned that this is simply a rebound, not another bubble, not yet.
"I don't think we are on the cusp of a bubble," said Sharon Wright of SSW Fine Properties, a 15-year veteran of the Houston real estate market. "I think [the market] is going to level out by the end of this year."
But with high home valuations come real problems for potential homeowners, like me. After finding a house we truly loved, we made an offer that was accepted. Admittedly, the offer was high (just over the list price), but there was another offer sheet on the desk of the listing agent the same day as ours. Competition is high and it is not uncommon for agents to receive multiple offers for homes within days of the house hitting the market, particularly in desirable areas inside or just outside the loop.
"The last three months, I've been doing this seven years, it has never, ever, ever been like this," said Michael Fischer, an agent with Champions Realty. "There's not as much inventory [as in previous years] and since the rates are low, the demand is just crazy."
Fischer even did something he'd never done this year. He assisted a buyer in putting a bid in on a home before even looking at it in person.
We didn't go that far, but when our bid was accepted and the inspections cleared with few problems, we felt we were on our way to closing until the appraisal came in.