Houston’s real estate market has officially rebounded from a two-year sales slump, showcasing promising growth throughout 2024. According to the Houston Association of Realtors, home sales activity rose for the fourth consecutive month in December, marking a 1.3% increase in overall sales volume—the first uptick since 2021. This resurgence signifies a crucial turning point for the local market, which had been experiencing fluctuations in monthly sales figures.
The luxury segment, particularly homes valued at $1 million and above, played a pivotal role in this resurgence, driving a 16.3% spike in December home sales compared to the same month in 2023. This trend not only reflects a heightened interest in high-value properties but also indicates a balanced market with a four-month inventory supply, favoring both buyers and sellers.
Shae Cottar, regional director for LPT Realty and newly appointed Chair of the Houston Association of Realtors for 2025, acknowledged the market’s resilience. Despite the challenge posed by elevated mortgage rates, Houston outperformed many other regions across the United States. Cottar noted, “While higher mortgage rates presented financial challenges for some consumers, the Houston market weathered these rate fluctuations better than many other regions across the country.”
The recent uptick in sales can be partially attributed to economic factors, such as increased confidence in the economy following election cycles. This pattern, often observed regardless of the winning political party, tends to invigorate consumer spending and real estate transactions. Additionally, the Federal Reserve’s incremental interest rate reductions, including the last cut in September, have bolstered consumer confidence, even as mortgage rates continue to hover around 6.9%, as reported by NerdWallet.
Mortgage rates are experiencing typical volatility during this time of year, influenced by bond traders’ end-of-year adjustments and the anticipation of a new presidential administration. Holden Lewis of NerdWallet explained, “Mortgage rates are bouncing around, as expected when bond traders stake out their end-of-year and beginning-of-year positions. On top of that, a new administration will be inaugurated in less than two weeks. These events contribute to rate volatility.”
Looking ahead to 2025, the Houston Association of Realtors anticipates that local home values will remain stable, which could benefit potential homebuyers. The steady sales activity and ample inventory seen in 2024 are expected to sustain the market’s momentum into the new year. Shae Cotten shared a positive outlook, stating, “I believe that the strong sales activity and expansive inventory we experienced in 2024 bodes well for homebuyers and sellers in 2025.”
Beyond local dynamics, Houston’s housing market resurgence aligns with broader national trends. According to the National Association of Realtors, U.S. home sales in 2024 reflected a similar pattern of renewed activity, driven by improved economic conditions and growing demand across various segments of the market. The trend underscores the adaptability of the housing sector in responding to fluctuating financial landscapes and consumer needs.
