They say that everything is bigger in Texas, and when it comes to housing, the figures just might back that up.
For the second year in a row, Texas real estate set a record pace, with home sale and home prices both hitting all-time highs.
According to the Texas Association of Realtors, more homes were sold in the Lone Star State in 2016 than in any other year, topping the previous record set in 2015.
The median price increased 7.7 percent to $210,000 on sales volume that was up 4.6 percent to 324,924 homes sold.
The Dallas-Fort Worth area had even bigger home market gains in 2016. Median home prices were up more than 9 percent to a record $232,000, according to the Texas Association of Realtors.
Vicki Fullerton, chairman of the Texas Association of Realtors, said strong gains posted at the end of 2016 helped set the record page.
“Last year’s record home sales activity was fueled by the momentum of multiple years’ strong job and population growth across the state, despite the fact that Texas job and economic growth began to slow in 2016,” she said.
And one analyst told the Dallas Business Journal that he expects the housing market to continue to boom for the foreseeable future.
“With all the job growth and in-migration of companies moving to Dallas-Fort Worth, we’re going to continue to see a tremendous amount of activity,” said Ted Wilson, principal at Dallas-based Residential Strategies.
Jim Gaines, chief economist at The Real Estate Center at Texas A&M University agreed with that assessment, noting that he expects the Texas housing market in 2017 to keep pace with last year’s strong levels of housing sales.
One potential challenge is home prices, which are rising more rapidly than household incomes. This could put a damper on future growth in home sales.
“Household incomes are rising at a disproportionally low rate than home prices, creating housing affordability challenges across the state,” Gaines pointed out.
Gaines added that there are other hurdles that could present challenges to continued growth and impact prices.
“In housing development, labor shortages and regulatory barriers are slowing construction and in turn, driving up new home prices,” he said.
Across the Lone Star State, the low housing inventory mark in 2016 was consistent with the previous year. The state ended the year with 3.3 months of inventory. The Real Estate Center at Texas A&M University indicates that a market balanced between supply and demand has between 6 and 6.5 months of inventory.
Moreover, time on market also remained consistent in 2016 compared to the previous year. Texas homes spent an average of 58 days on the market, and active listings increased 10.8 percent from 2015 to 2016.