• Houston home prices are 20 percent above their long-term fundamental value
  • Home prices are rising at a slower rate than during the previous two years.
  • Have home prices peaked in some Houston markets?

The Houston housing market is starting to show its first signs of weakness, according to one source.

These first signs: falling sales activity and slower home price appreciation.

CoreLogic points to stats from the Houston Association of Realtors (HAR) that show home sales volume dropped by 10.2 percent year-over-year in October. According to HAR, this represents the fifth time this year where monthly sales have fallen on a year-over-year basis.

“Slower home sales likely stem from declining employment,” CoreLogic stated, adding Houston has the nation’s 10th-highest concentration of oil and mining employment.

While home prices are up year-over-year, they’re rising at a slower pace than during the last two years, when prices increased by 9.7 percent (2014) and 11.1 percent (2013).

According to a CoreLogic index, home prices in Houston rose 7 percent year-over-year during September.

Two months ago, HAR stats showed Houston’s median home price climbed to a record level for an October, reaching $205,000. Moving forward, gain in home values are expected to further slow.

“Houston home prices are about 20 percent above their long-term fundamental value, and are projected to be largely flat through September 2016,” CoreLogic said.

The firm notes that smaller metros in west Texas, Midland and Odessa, have the highest concentration of oil-related employment in the nation and should see similar oil-related housing slowdowns.

Email Erik Pisor

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Real estate news and analysis that gives you the inside track. Subscribe to Inman Select for 50% off.SUBSCRIBE NOW×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription