A surge of single-family home sales in the fourth quarter of 2014 ensured it was one of the best years ever for Texas real estate. According to a new report from the Texas Association of Realtors, home sales statewide in the final stretch of 2014 were up more than 8 percent compared to the same time period in 2013.
That late-year boost — 66,664 total — pushed Texas home sales to their highest levels since 2006, which no one thought possible because of the relatively stagnant growth (zero to 2 percent) in the first three quarters.
"A dip in mortgage interest rates below 4 percent in the last half of 2014 created an ideal climate for this year-end surge in home-sales growth," said Jim Gaines, an economist with the Real Estate Center at Texas A&M University, in a release. "However, fewer homes on the market and strong demand maintained rising home prices and shrinking months inventory."
In Dallas, home sales increased more than 6 percent in the fourth quarter, while average price was up 8.58 percent, to $267,515.
In Q4 2014, the median price for Texas homes was $185,900, a 7.76 percent increase from the last quarter of 2013; the average price increased 6.99 percent to $240,976. However, housing inventory fell to an all-time low of 3.3 months — a decrease of 8.33 percent from one year prior. This was in spite of the fact that the second half of 2014 saw an end to the double-digit quarterly drops in inventory that have occurred since summer 2011.
That inventory figure is nearly half the 6.5 months that the Real Estate Center at Texas A&M University cites as a market balanced between supply and demand.
In Dallas, home sales increased more than 6 percent in the fourth quarter, while average price was up 8.58 percent, to $267,515. Bucking the statewide trend, our inventory was down 12.5 percent, to 2.1 months.
To the north, in Collin County, sales were up 5 percent, and the average price was up 9.34 percent, to $308,100. Inventory decrease was not as dire — 6.25 percent — but there was only 1.5 months of inventory.
Speaking of dire, inventory in Arlington dropped a whopping 25 percent, to 1.5 months. There sales in the fourth quarter were up 3.78 percent, and the average home price rose 8.71 percent, to $179,889. Fort Worth saw the same massive dip in inventory, to 2.4 months. Homes sales were up 5.87 percent, and average price hit $180,453, good for a 9.36 percent jump.
Irving saw a substantial increase in average home price: 25.43 percent, to $257,049 — the second highest in the state. Its inventory was also down 25 percent, to 2.1 months, and home sales were up 7.77 percent.
Percentage-wise, South Padre Island saw the biggest increase in home sales in the fourth quarter of 2014: 41.86 percent. The city with the greatest boost in average home price was Palestine, at 34.6 percent. The area with the biggest percentage drop in inventory for 4Q2014 was Brazos County, at 35.55 percent.