Post-Harvey’s prices, new construction declines in market share, and rising rates.
(League City) The main topic of interest for 2017 is how Harvey impacted the real estate market. The quick answer is that Harvey slowed the activity (i.e., homes going under contract and new listings coming on the market), but average sale prices for League City continued to climb.
Although homeowners are happy to see that Harvey didn’t impact prices, don’t forget about those who were hit hard by this storm and are still rebuilding their lives, the first responders, and caring neighbors who came together to help others. My heart goes out to you all.
Check out the full report below for more details about what happened in 2017 and what’s expected for interest rates in 2018.
Homes Sold: There were 1,266 homes that sold in 2017, down 3% from 1,303 homes sold in 2016.
Days on Market: The average days-on-market was 36 days for 2017, compared to 30 days for 2016. Half of those homes went under contract within 17 days.
Sale Prices: Despite Harvey’s impact, the average sales price increased for the seventh consecutive year (2011 marked the first increase since the recession), ending the year at $277,000–an 8% increase compared to 2016. 2017 now holds the crown of the highest average sales price in history for League City.
Price per Foot: The average price per square foot hit $109 for the end-of-year average. That’s up from $104 per foot for 2016.
Market Share: New construction sales accounted for 15% of the market, down from 17% in 2016. That’s the second consecutive decrease in market share (2016 marked the first decrease). Since the land in League City is scarce for residential developers, this trend will likely continue to dwindle in the coming years.
Sale Price: The average sale price for new construction rose to $353,000, which is a 7% increase from 2016. When comparing this to the average sale price of non-new construction homes the average cost was 27% higher, or $76,000 dollars, more than non-new construction homes.
This reveals a healthy gap that keeps the new construction and non-new construction homes from competing with each other.
Showing Activity: The Centralized Showing Service* recorded over 25,000 showings for League City homes in 2017. That’s the same as it was for 2016.
*The Centralized Showing Service schedules the majority of the showing appointments that realtors make for their clients. The number of showings listed here does not include showings that were made through other companies or their agents.
New Contracts: This is the first area that showed negative impacts from Harvey. When comparing August 2017 (when Harvey hit) to August of 2016, the number of new contracts dropped 20%. It dropped another 13% in September, but began to pick back up in October. The total number of new contracts for 2017 was 509. That’s down 5% from 2016. As a whole, not bad, considering the devastation of the storm.
New Listings: The number of new listings that came on the market followed a similar pattern (but not exactly) as the new contracts trend. This number dropped 14% in August, 22% in September, and another 10% in October. It began to pick up again in November. However, the total number of new listings that came on the market in 2017 increased 3% when compared to 2016.
With the growth of the city being healthy, prices will likely continue in this fashion for the near future. However, the big topic for 2018 is interest rates, as it was with 2017. At the beginning of 2017, the Feds were expected to raise rates three times, and they did. The same prediction stands for 2018. We don’t know what kind of an impact this will have on the market, but I don’t see a negative outcome for League City. I expect to see another strong year.
While many are still rebuilding their lives after the storm, at least you have a strong market to sell your home in, should you need to do so. This is vital to homeowners who are counting on their home’s equity as a significant part of their financial asset.
If you’re interested in learning more about how I can help, just reach out to me, and I’d be glad to answer any questions you might have. You can also stay connected to everything I’m doing by reading my monthly House Prices Report publication. It contains valuable information for building your home’s equity and will keep you informed of the market. Just send me an email, text, or call, and I’ll get it to you!
See you soon!
Josh Hayles | Local realtor | Josh@Mydailyhomes.com
1. All numbers were compiled using the HAR’s MLS system.
2. New construction was not used in conjunction with non-new construction homes.
3. The Centralized Showing Service is not the only company who sets up showing appointments, it’s however, the most used.