Houston is America’s fourth-largest city. The Greater Houston area is home to over 7.21 million residents and boasts a diverse economy. The city has seen tremendous growth and development in recent years, fueled by its position as the nation’s energy capital.
As the oil industry continues to boom, Houston is poised to become even more prominent. This statistic means more jobs, higher wages, and rising property values. As mortgage rates rise, many more first-time buyers are looking for listings in Houston. So what does the future hold for the Houston real estate market?
2023 Houston population growth projections
The Greater Houston Area (GHA) population saw the third-largest increase in the U.S. in 2020. In 2021, the population in Houston was 7.21 million people. Based on growth from previous years, the population in the Greater Houston Area will likely exceed 7.3 million people.
Houston home prices and sales
Compared to December 2021, single-family home sales have decreased by 32.6% in December 2022.
2022 was the first time since 2019 that the Houston area did not set a record for single-family homes.
The median price for a single-family home in metro Houston is $310,000, with an average home price of $340,000. The average home sells for around 3% below list price. The median days on market in Houston is 37 days. Compared to 2021, this is 10 days more.
2023 Houston housing market outlook
As home sales have continued to decline, the trend is likely to continue into 2023. In December 2022, 1,610 homes were sold, which is a decrease of 47% compared to December 2021.
The active listing count in the Houston was at 33,776 in December 2022.
Listings are likely to remain the same or decrease throughout the beginning of 2023 as interest rates are still high.
Many who have lower interests rates on their current homes likely aren’t looking to list and purchase a new home in the current market.
However, buyers will continue to have the upper hand in Houston as the days on market have increased and the median sales price has remained constant. With less offers and competition, first-time home buyers or those new to the housing market are likely to avoid bidding wars or a lack of selection.
As a real estate agent converting buyer leads will be essential to growing your business in 2023.
Average rental prices in Houston, TX
As of January 2023, the rental market in Houston is still hot, but does show signs of cooling. The median rent for a one-bedroom is $1,319, a 6% increase from 2022.
That said, the average rent of apartments has begun to decrease. Studio apartment rents have decreased by 10%, while one and two bedroom apartment rents have decreased by 3%.
Houston cost of living
According to MIT’s Living Wage Calculator, a single adult with no children in Houston needs to make at least $16.39 an hour or $29,327 annually after taxes.
When looking at expenses, housing is typically the largest expense, estimated at $10,784 a year.
In comparison to other U.S. metros, Houston has the second lowest cost of living, at about 8% lower than the national average.
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