HOUSTON — (February 14, 2025) — Houston’s housing market remained strong in January despite an unusual winter storm that briefly disrupted activity. The market quickly regained its momentum, maintaining a solid balance between supply and demand. Remember, we're looking at how the market performed in the las month of January.
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January 2025 Market Breakdown
Key Highlights
- Total property sales increased 1.3% year-over-year.
- Total dollar volume increased 8.9% to $2.5 billion year-over-year.
- Active listings increased 26.3% year-over-year.
Single-Family Homes Overview
January marked five consecutive months of sales growth for single-family homes:
- Sales: 5,064 homes, increased 1.2% year-over-year.
- Average Price: increased 4.4% to $406,492 year-over-year.
- Median Price: increased 1.6% to $325,000 year-over-year.
- Price per Square Foot: increased from169 to $174 year-over-year.
Inventory & Time on Market
- Active Listings: 33.3% higher than last year, staying around 30,000 homes for eight months.
- Days on Market (DOM): Homes took 61 days to sell on average, up from 59 days.
- Months of Inventory: Increased to 4.3 months, up from 3.2 months last year.
- National Inventory: Currently 3.3 months, per National Association of Realtors (NAR).
Single-Family Home Sales Continue to Climb
According to the latest Houston Association of Realtors (HAR) report, single-family home sales across Greater Houston increased by 1.2%, with 5,064 homes sold compared to 5,002 in January 2024. This marks the fifth straight month of growth, a trend last seen in early 2021.
Luxury Homes Lead the Market
Higher-priced homes continue to attract buyers:
- Luxury homes ($1M+) saw a 20.7% jump in sales year-over-year.
- Homes priced between $500K and $999K increased by 8.1%.
- The $250K to $499K price range accounted for the most sales but dipped 1.6% from last year.
- Homes priced $149K and below experienced a slowdown.
Steady Market Conditions as Spring Approaches
HAR Chair Shae Cottar of LPT Realty noted, “Houston’s housing market is in a healthy position as we enter the spring and summer seasons. Inventory levels are strong enough to meet the expected increase in buyer activity. While interest rates remain a factor, overall market fundamentals are solid.”
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Breakdown by Price Segment
| Price Range | % Change (YoY) |
|---|---|
| $1 - $99,999 | -4.1% |
| $100,000 - $149,999 | -10.4% |
| $150,000 - $249,999 | +3.0% |
| $250,000 - $499,999 | -1.6% |
| $500,000 - $999,999 | +8.1% |
| $1M+ | +20.7% |
Existing Homes
- Total Sales: 3,493 homes, up 2.5% year-over-year.
- Average Price: $415,004, up 7.6% year-over-year.
- Median Price: $323,000, up 4.5% year-over-year.
Townhome & Condo Market Rebounds
January was a positive month for Houston’s townhouse and condo market:
- Total Sales: 360 units, up 6.8%, marking only the second positive month since mid-2022.
- Average Price: $248,241, showing little change.
- Median Price: $211,000, a 4.1% decline.
- Inventory: Expanded from 3.6 months last year to 5.6 months.
Interest Rates and Market Impact
Interest rates remain a crucial factor in the Houston housing market. In early 2025, average mortgage rates for a 30-year fixed loan hovered around 6.5% to 7%, slightly lower than the peaks seen in 2023.
What This Means for Buyers and Sellers
- Buyers: While rates are still higher than pre-pandemic levels, they have stabilized, providing more confidence for those entering the market. If rates decrease further, demand could rise, leading to increased competition and potential price hikes.
- Sellers: A stable or declining interest rate environment can bring more buyers into the market, making it easier to sell homes at strong prices.
Pro Tip: If you're thinking about buying, consider rate buy-down programs or adjustable-rate mortgages (ARMs) as alternatives to lock in lower payments.
Mortgage rates are expected to trend downward throughout 2025, but much depends on Federal Reserve policy and inflation trends. Keep an eye on updates from Freddie Mac and Fannie Mae for the latest forecasts.
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Interest Rates and Market Impact
Interest rates remain a crucial factor in the Houston housing market. In early 2025, average mortgage rates for a 30-year fixed loan hovered around 6.5% to 7%, slightly lower than the peaks seen in 2023.
What This Means for Buyers and Sellers
- Buyers: While rates are still higher than pre-pandemic levels, they have stabilized, providing more confidence for those entering the market. If rates decrease further, demand could rise, leading to increased competition and potential price hikes.
- Sellers: A stable or declining interest rate environment can bring more buyers into the market, making it easier to sell homes at strong prices.
Pro Tip: If you're thinking about buying, consider rate buy-down programs or adjustable-rate mortgages (ARMs) as alternatives to lock in lower payments.
Mortgage rates are expected to trend downward throughout 2025, but much depends on Federal Reserve policy and inflation trends. Keep an eye on updates from Freddie Mac and Fannie Mae for the latest forecasts.
Looking Ahead
Houston’s housing market is set for a busy spring and summer, with inventory levels strong enough to meet rising demand. The luxury market is booming, and price growth remains steady. While interest rates could influence buying power, Houston’s market fundamentals remain solid heading into 2025.
