The Texas housing market may be on the road to recovery. According to the latest Texas Quarterly Housing Report released Monday by the ""Texas Association of Realtors"":http://www.texasrealtors.com/, both sales and prices for homes in the Lone Star State increased on a year-over-year basis in the first quarter of this year.[IMAGE]
Sales volume for existing single-family homes was 42,682 for the first three months of 2010, up 4 percent from the same period in 2009. In addition, the median home price jumped 3.13 percent from $137,200 in the first quarter of last year to $141,500 in the first quarter of this year.
""First quarter 2010 figures were up compared to 2009, despite sales being down in January and February,"" said Jim Gaines, Ph.D., an economist with the ""Real Estate Center at Texas A&M University"":http://recenter.tamu.edu/, which compiled and analyzed the data for the quarterly report.
Gaines noted that the positive year-over-year gain was due solely to significant March sales being strong enough to bring up the whole quarter. ""With March's increased figures we are cautiously optimistic that we'll continue to see positive results in the second quarter,"" he said.
According to Gaines, several local multiple listing services reported a larger percentage of sales coming from foreclosed properties. However, he added that Texas has maintained a near-balanced market of 6.8 months of inventory, statistically unchanged from 2009. Additionally, he said the market is showing strength by maintaining property values, indicating that the market is absorbing foreclosed properties and not experiencing an excess of supply.
""We are seeing gradual improvement in the Texas housing market and managing our foreclosure rates well compared to national rates,"" Gaines said. ""Other states, such as California and Florida, are seeing significant foreclosure increases due to high unemployment rates in combination with exotic mortgage-financing options such as option ARMs. Texas is not experiencing the same levels of pressure in these areas.""
Bill Jones, chairman of the Texas Association of Realtors, said Texas' home-equity lending laws have provided homeowners across the state with some of the strongest consumer protections in the nation, which is why Texas has been able to avoid drastic foreclosure increases compared to other states. He explained that many of the states facing the highest foreclosure rates and largest drops in real estate values are the same states that allow homeowners to borrow 100 percent or more of their home value.
Looking forward, Gaines said the next two quarters will determine the real strength of the market for 2010. He thinks the second quarter should continue to show positive improvement due to increased demand and government incentives, namely the federal homebuyer tax credit, which expired April 30. And he said the third quarter, typically the best quarter of the year, ""will show us how well the market can sustain itself.""