Hi neighbor,
Today I will be sharing with you our perspective on the local real estate market here in Spring, Texas, specifically a market update for the neighborhood of Memorial Northwest. Whether you are looking to buy, sell, or just keep an eye on the market, we look forward to being your resource.
What is happening in the real estate market in Memorial Northwest?
We currently have 11 homes pending, with 6 homes sold in the last two weeks, averaging a sale price of $118 a square foot. Six homes sold over the asking price, with one home selling 2% above the listing price.
Compared to the two weeks prior: Homes sold are up from 4 homes sold to 6 homes sold. Every home is different, with different features, so don’t forget to ask us for your annual equity review if you are curious about your personal home. You can text AER to 79564 or email us here.
Buyer agents around Houston are seeing a slow in the real estate market, but it isn’t affecting every neighborhood. I know the interest rates rising has been one deterrent from some buyers purchasing right now, but that isn’t your ideal buyer anyways!
The most desirable homes in the area are still selling the first weekend or first week they hit the market (a really good coming soon campaign, like we do at Jo & Co. allows you to sell faster, for more money)
Check out the graphic below for a larger overview of the real estate market for the last two weeks in Memorial Northwest.
Jo's Two Cents
Nationally, we are seeing an increase in average days on market, which locally is only affecting 30-50% of homes. This means we are seeing an increase in inventory. Personally, we will be able to confirm this, when we have new market report data to look at on October 1st. This is good news for buyers who recognize that mortgage interest rates in the five to six percent range may seem high compared to the last couple of decades, but they are still low compared to any year going back as far as 1970. The number of new listings coming on the market has waned, but the increase in inventories is seen more so from a sharper decrease in buyer demand. All of this provides possible opportunities for buyers who remain in the market and might be able to come to a sales price that sellers might not have agreed to even a few months ago.
New construction contract cancellations are up locally and nationally, bringing the available new construction inventory in the Houston MLS to 9,030 homes. This is insanely good news for anyone looking to buy an inventory home right now. The incentives that are being offered are the best I personally have ever seen. Most builders are offering between $10,000 and $30,000 towards closing costs and/or offering to buy down interest rates to three percent and four percent. Here is a list I gathered a couple of weeks ago showcasing some of the builders offering really low-interest rate locks. The last two to three years were absolutely abnormal, so with normalcy and stabilization on the horizon, we should see the market pick back up post-November.
Recently the Mortgage Bankers Association reported that mortgage applications are also at 22-year lows, according to a MarketWatch article. That is due to a combination of lower sales but also a refinancing market that has dried up. They do say they see things turning around in the not-too-distant future, as economic data shows the job market is strong. That means higher wages, which means people can afford more. That combined with more inventory on the market means sales should eventually increase.
Recently the Mortgage Bankers Association reported that mortgage applications are also at 22-year lows, according to a MarketWatch article. That is due to a combination of lower sales but also a refinancing market that has dried up. They do say they see things turning around in the not-too-distant future, as economic data shows the job market is strong. That means higher wages, which means people can afford more. That combined with more inventory on the market means sales should eventually increase.
What is happening in the real estate market nationally?
Mortgage rates trended higher last week after the Fed raised the benchmark interest rate once again. Home builder sentiment slipped lower in September. Building permits slipped in August while housing starts soared. Existing home sales were better than expected. Mortgage application submissions increased. Continuing jobless claims fell while initial jobless claims rose.
| MORTGAGE RATES CURRENTLY TRENDING | THIS WEEK'S POTENTIAL VOLATILITY |
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Notable News
- CMG Financial’s Dave Herbst named a 2022 HousingWire Insider. Read Now >>
- Taking a deeper look at the recent spike in mortgage application submissions.
Watch Now >> - How the latest rate hike will affect your wallet. Read Now >>
Market Recap
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In September, home builder sentiment slipped to 46 on the National Association of Home Builders (NAHB) home builder sentiment index.
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In August, housing starts were at a seasonally adjusted annual rate of 1.575 million, a 12.2% increase from the month before. Building permits were at a seasonally adjusted annual rate of 1.517 million, a 10% drop from the previous month.
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Mortgage application submissions increased 3.8% during the week ending 9/16.
Refinance application submissions increased 10% while purchase application
submissions increased 1%. -
Existing home sales were at a seasonally adjusted annual rate of 4.8 million in August.
While this is a 0.4% decrease from the month before, it is much higher than experts
had predicted. -
The Federal Open Market Committee (FOMC) unanimously decided to raise the benchmark interest rate another 0.75% in September. This brings the federal funds rate to arrange of 3.25% to 3.50%.
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Continuing jobless claims decreased 22,000 during the week ending 9/10. Initial jobless claims increased 5,000 during the week ending 9/17.
Review of Last Week
FED HIKE SINKS STOCKS… The Fed's third straight big interest rate hike was all it took to send stocks to another week of losses, as investors feared the central bank's aggressiveness would drive the economy to a hard landing.
Fed Chair Jerome Powell added fuel to the fire, warning the job is not done with raising the rate to fight inflation. He thinks the Fed will get to 4.6% relatively quickly, and that's likely to cause pain by weakening the labor market.
Wall Streeters worry there will soon be large cuts to corporate earnings estimates, but good news came when the flash manufacturing Purchasing Managers Index (PMI) and the flash services PMI both rose for September.
The week ended with the Dow down 4.0%, to 29,590; the S&P 500 down 4.6%, to 3,693; and the Nasdaq down 5.1%, to 10,868.
The rate hike also hammered bond prices overall, with the 30-year UMBS 5.0% down 1.15, to $98.03. With bond prices down, the national average 30-year fixed mortgage rate moved up in Freddie Mac's Primary Mortgage Market Survey. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
DID YOU KNOW… On Zillow’s national Index, the value of the typical U.S. home fell 0.3% in August after a 0.1% dip in July. The August decline is the largest monthly drop since 2011, though values are still up 14.1% year-over-year.
Market Forecast
HOME SALES, GDP DOWN, INFLATION UP… For August, both New Home Sales and the Pending Home Sales index of signed contracts on existing homes should be off. The GDP-Third Estimate for Q2 is also expected down, showing the overall economy is still contracting. Going in the other direction, unfortunately, is August inflation, still headed up by the PCE Prices measure the Fed favors.
Summary
It was a surprise to see August Housing Starts surge 12.2%, to a 1.575 million annual rate. Not surprising was the 10.0% dip in new Building Permits, since the backlog of homes authorized but not yet started sits near record highs.
Equally unsurprising, the September NAHB homebuilder sentiment index dropped for the ninth month in a row to a 46 read. Scores below 50 indicate more builders see conditions as poor, versus good.
August Existing Home Sales, off 0.4%, slipped for the seventh straight month, the longest streak since 2007. Annual median price growth fell to 7.7%. Demand stayed strong–81% of sold homes were on the market for less than a month.
Can we sell yours?
So if you are in need of a listing agent, we would love the opportunity to see your home and meet you of course. My husband, Edward, and I, look forward to being the brokerage and team for you! You can reach out to us via email: [email protected] & [email protected] or telephone: 832-493-6685.
Read more:
If you are curious ‘How to get more money for your home when listing it for sale', check out this blog post.
I hope you have found this blog post super helpful. If there is anything else we can do for you, including helping you sell (or buy) a home, I would be honored to assist. I hope you have a great day/evening. Cheers, E + J.
We are so happy you found our little corner of the interwebs. We look forward to y'all reaching out to us. We love to answer questions and welcome them. Recently we created some local maps, and you can download those by clicking the image/link above. Below, you will find an index of some very helpful information to assist you in learning more about the Houston suburbs. If you are relocating to our neck of the woods, we hope you reach out to us, because we would love to help you by being your local realtor and friend. Thoughtfully written for you. Hugs, Jo.
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If you are overwhelmed..
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