THE GREAT INNER-LOOP TEARDOWN BACKUP “Since builders cannot get credit to build spec homes right now, they are not buying older “tear-down” homes in West U and Bellaire. As a result, the $400K-$499K price range in West U and Bellaire is a strong buyer’s market with inventories stacking up.” [Strictly a Buyer’s Agent]
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This is the way I see. Feel free to correct:
The builders will still have to get a loan as a business. It’s harder for the lending institution to justify lending money to renovate a tear down that needs the renovator to sell to potentially payoff the loan. Remember the loan will be for the purchase of the property and the renovation.
Individual homeowners looking for the property as a home is different since they are less likely in reselling for a profit since the can just live there.
Renovations in Bellaire are more plentiful than in West U from what I have seen.
Interesting. I didn’t realize that builders drove that 400-499 segment so completely (just look at the 2008 data sheet she has on her site to see the magnitude of the change immediately after the credit crunch hit.) I would have thought that that segment would have been better protected by the lower interest rates available on conforming loans (<$417k).
The “middle” of the market there (500 to 800 or so) is holding up surprisngly well considering the much higher rates on jumbo mortgages.
As always, there’s lies….
Not that she’s trying to be deceptive, but stats can be misleading.
For example, the the months of inventory in the tables are based on sales for the previous twelve months. With the oil bubble, I don’t think the crunch hit Houston until fairly recently. Thus, using last year’s numbers to calculate inventory is not necessarily accurate. If sales fell off a cliff recently, then the inventory numbers would be much higher. Just the opposite if sales had recently increased greatly.
I believe Nancy Sarnoff recently wrote that sales greater than 500k were down 42% year over year in Feb for Houston overall.
http://www.chron.com/disp/story.mpl/realestate/homes/6316711.html
I did notice that West U listings now number 360, versus 297 during the first week in February. Did not try to break that down any further.
yup, it seems like every 55-60 year old in WU who was banking on selling the house to cover half of their retirement all just had the same UH-OH moment. the listings of these “Buy now ..build later” lot value things has surged. i am seeing 5 new listings a week past couple of weeks. As far as listings growing in March, we will have this growth every year, from January to July until it gets worked off. Either way you look at it the market is really weak. And construction in the best hoods inside the loop has slowed to a crawl. no new resi construction loans, climbing builder inventories = lot values headed lower
Having been closely monitoring inventory for a potential purchase in WU the past year, I would say things really started turning more favorable for buyers in the last few months. But I think this is just the start–there are houses that have been on the market 7-10 months with little or no price reduction. While Houston did not have “bubble” pricing like CA, look at the WU appreciation stats on the GreenwoodKing web site. WU had appreciation levels that rival some bubble cities.
as Mike stated it’s hard to get a real accurate handle on a market based on year old data…
that said, the demand has slowed for housing in these areas simply because of the sheer amount of competition for those high dollar purchasers… The amount of inventory when you get over $400k in Houston is amazing! There are some great deals on the market and the selection is only getting better.