The Houston real estate market enjoyed a tenth consecutive month of rising sales in March, with homes continuing to sell quickly enough to keep housing inventory at its lowest level since December 2008. Average and median prices achieved the highest levels for a March in Houston, with the average price coming just a few dollars shy of the all-time high set in June 2008.

According to the latest monthly data prepared by the Houston Association of Realtors (HAR), March sales of single-family homes rose 7.8 percent versus one year earlier. That follows February's 15.6 percent jump which was the biggest sales boost since last September. Declining sales of homes priced below $80,000 combined with increased activity in the luxury housing segment fueled the pricing gains.

"March was an excellent month for home sales in Houston and the healthy appreciation in pricing is welcome news as well," said Wayne A. Stroman, HAR chairman and CEO of Stroman Realty. "Inventory remains at its lowest level in more than three years and is outpacing the national real estate market. The moderation in pending sales in March could possibly translate to a leveling off of sales before we enter the summer buying season, but we will know for sure next month."

The March single-family home average price rose 5.7 percent year-over-year to $227,270, the highest level for a March in Houston and only $70 below the all-time high reached in June 2008. The median price—the figure at which half of the homes sold for more and half sold for less—climbed 7.8 percent to $161,750, also a record high for a March in Houston.

Foreclosure property sales reported in the Multiple Listing Service (MLS) fell 12.8 percent year-over-year in March. Foreclosures comprised 19.6 percent of all property sales, which is down from the 21.1 percent level observed over the past 12 months. The median price of foreclosures in February was flat at $81,500.

March sales of all property types in Houston totaled 5,908, an increase of 7.4 percent compared to March 2011. Total dollar volume for properties sold during the month soared 15.2 percent to $1.3 billion versus $1.1 billion a year earlier.

Source: Houston Association of Realtors

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Despite today's uncertain economic climate, a noted residential analyst sees a "slow upturn" ahead for the Texas housing market.

Dr. Jim Gaines, research economist for the Real Estate Center at Texas A&M University, is optimistic about the state's home sales in coming months.

"Home sales in the state rebounded a very modest 0.7 percent in 2011," he said. "That was a big improvement over the 4.5 percent decline in 2010. A gradual improvement in monthly sales moving toward the long-term norm is expected to continue into 2013."

Gaines projects Texas home sales to be in the neighborhood of 212,000 this year, an increase of 3 to 3.5 percent more than last year.

"The projected 2012 sales level is consistent with the historical rate of statewide sales per 1,000 households," said Gaines. "The three-year sales trend that began in 2010 reflects a reversion to the 1997/98 pace."

In other words, he said, sales are getting back to a "normal and sustainable" level. The residential analyst cautions that the Texas housing market is "somewhat precarious" and even a small factor could derail the housing recovery.

Gaines cited several economic concerns — both in the United States and overseas — that could alter his predictions dramatically. For example, Europe's unstable financial markets could trigger a US 'retrenchment' or outright recession. In this country, the credit squeeze makes mortgages more difficult to obtain.

"Many buyers are postponing purchases because of a lack of confidence in the market," Gaines wrote in an article published recently in Tierra Grande magazine. "They are concerned that prices may not have bottomed."

Source: Real Estate Center at Texas A&M University

The Texas real estate market gained positive momentum in the first quarter of 2012, according to the 2012-Q1 edition of the Texas Quarterly Housing Report issued late April by the Texas Association of Realtors. The volume of single-family home sales in Texas was 12 percent higher than the same quarter of 2011 and the median price increased by almost three percent over the same time frame.

"The watchword for Texas real estate in 2011 was 'consistency,' in both sales volume and price. That allowed us to emerge from last year with stable sales volumes and strong property values," said Joe Stewart, chairman of the Texas Association of Realtors. "Now, in 2012's first-quarter results, we see a strong increase in sales volume and a meaningful increase in the median price. That indicates positive momentum for the year ahead."

For the period of January through March 2012, the volume of single-family home sales in Texas was 45,502, 12 percent more than the same quarter in 2011. The median price for Texas homes during the quarter was $147,100, 2.7 percent more than 2011-Q1.

Jim Gaines, PhD, an economist with the Real Estate Center at Texas A&M University, expanded on the report: "We believe several factors are driving the strong performance of the first quarter, including continued job growth in Texas and some increased access to credit for home buyers. Most of all, we're starting to see a shift in Texans' attitudes toward real estate. Essentially, buyers and sellers have higher expectations for the market, so they're beginning to take action and we're starting to see the impacts."

Looking ahead, the "months inventory" calculation can provide insight into future demand for homes and that figure decreased from 7.6 months in 2011-Q1 to 6.0 months in the first quarter of this year. "Months inventory" is an indicator of the balance between demand for homes and supply in the market and the Real Estate Center at Texas A&M University cites 6.5 months of inventory as a balanced market.

Gaines continued, "In Texas, our inventory of homes for sale has been decreasing for about six months now. That's due in part to the fact that some homeowners who don't have to sell have chosen to wait for prices to improve before selling their homes. In addition, the slower processing of foreclosures and fewer distressed properties may reduce the number of listings. However, a decrease of more than 20 percent in the inventory of homes compared to the same quarter last year is significant and may be an indication of price increases in the future."

Chairman Stewart concluded, "If all the indicators play out as we expect, the Texas real estate market is in for a busy spring and summer."

Source: Texas Association of Realtors

Both sellers and buyers can find good news in the most recent outlook for the Texas housing market.

For sellers, the good news is that 2011 Texas home prices increased for the second consecutive year and are likely to do so again this year. For buyers, the good news is that prices went up only modestly, and the 2012 home appreciation rate is expected to be less than the historical norm.

"Texas home prices remain attractive relative to the national median," said Dr. James Gaines, research economist with the Real Estate Center at Texas A&M University. "But the gap between the two has narrowed significantly as the national median price has fallen."

The median price for a Texas home dropped less than 1 percent in both 2008 and 2009, increased 1.2 percent in 2010 and then by 0.7 percent in 2011. The 2011 median state price of $148,700 was a record high.

"In 2012, the statewide median price is expected to increase 1 to 2 percent to between $150,000 and $152,000," said Gaines. "That's less than half the historical average rate of appreciation."

The change in the median price in individual Texas metropolitan markets was mixed in 2011.

Nineteen areas had median price declines, three were flat and 25 reported higher median prices.

Source: Real Estate Center Texas A&M University

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A national study by HomeTeam Pest Defense, the third largest residential pest control company in the US, finds that 84 percent of America's homeowners experienced a pest problem in the past 12 months.

The top pest issues for homeowners in the last year were ants (49 percent), spiders (43 percent), flies (37 percent), mosquitoes (34 percent), mice (30 percent) and wasps (29 percent).

"Pests have appeared earlier than usual this year due to warm winter, early spring and recent heavy rains," said Russ Horton, national technical director for HomeTeam Pest Defense. "We have already seen termites, odorous house ants, and scorpions. We have already seen termite swarms in Texas, Georgia and Florida, odorous house ants in the Mid-Atlantic, and scorpions in Arizona."

Additionally, HomeTeam's national study found that 80 percent of homeowners are concerned about pests in their home. The top pests homeowners worry about are termites, cockroaches, rats, bed bugs and mice. Termites are the greatest pest concern, worrying one in four, and 13 percent actually experienced termites in the last 12 months. Nearly one quarter (22 percent) of homeowners have experienced structural damage to their home from a pest problem.

Eighty percent of homeowners are also concerned about being exposed to bed bugs when traveling, and most (81 percent) are not confident they know how to prevent bringing bed bugs into their home.

While many homeowners (54 percent) treated pest problems on their own, two-thirds of the do-it-yourselfers were unable to resolve their problem completely. Half of homeowners (51 percent) say using a pest control service is a necessity, and working with a company that guarantees its work was very important to almost everyone (95 percent). Treatments that will not harm children and pets were a high priority for 80 percent.

"There are easy ways to help lower your risk of infestation now and throughout the spring and summer," added Horton. "In some cases, calling a professional to evaluate and inspect your property thoroughly may save a great deal of unplanned expense, not to mention headaches and time in the future."

HomeTeam offers the following quick tips to prepare your home and prevent pest infestations:

• Seal cracks and small openings around doors, windows, garage doors and utility entry points.

• Get rid of standing water around the home.

• Cut back tree branches and bushes, keeping them away from the side of the house and roof.

• Install or repair screens on windows and doors.

• Fix dripping taps and leaking pipes to remove the water and humidity that some pests need to survive.

• Empty garbage cans and recycle bins regularly.

• Store food in sealed containers on countertops, cupboards or in the refrigerator.

Source: HomeTeam Pest Defense

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