Falling oil prices have been widely expected to hit Houston’s economy, and ultimately house prices, however January was another record month for the city’s housing.
Sales were up 6.1 percent in January as buyers closed on 4,032 single-family homes for a median price of $190,000, according to a monthly report from the Houston Association of Realtors.
Sales activity was strongest in the $250,000 to $500,000 price range, while homes less than $150,000 showed declines. The pace of sales has started to slow among homes priced higher than $500,000.
“January was a strong month overall for the Houston housing market, but we still expect to see sales cool as a result of lower oil prices and the limited supply of homes,” Nancy Furst, the association’s chairwoman, said in a statement.
Experts say housing will be affected by the coming economic slowdown, as energy companies announce tens of thousands of job cuts in Texas and elsewhere.
Though many of the jobs being eliminated today are in the oil field, higher-skilled employees will be affected, too, Boyd Nash-Stacey, an economist at BBVA Compass in Houston told the Houston Chronicle.
“With lower investment we’d expect to see a lower demand for higher-skilled professionals,” Nash-Stacey said.
With a constrained supply and strong demand, Houston’s home prices have risen sharply in recent years.
Based on the current energy market, housing prices aren’t expected to tank. Rather, they should appreciate at a slower rate, said Nash-Stacey.
“If (oil) prices continue to fall, it could have a greater impact in coming years,” he said.