According to Ron Hanlen of Network Funding, there is another factor currently driving Katy real estate inventory levels:  Mortgage interest rates. Despite dire predictions about the impending rise of mortgage interest rates, rates have held onto historic lows, in the 4’s.

Ron said, “Once the tax credit expired, everyone expected that listings would go down.  But they haven’t…they have gone up.  With all of the negative media attention on housing it would be easy to consider that it is because the sellers are distressed in some way. Maybe they lost their job or they are trying to sell the home before it goes into foreclosure.

But here is the real reason why listings are up:  Interest rates are at an all-time low. Despite the constant bombardment of negative media coverage, the vast majority of existing homeowners are very credit worthy, live within their means and have stable income.  Experienced homeowners have seen interest rates in the 5’s, 6’s, and 7’s in the last several years. With interest rates in the 4’s, savvy homeowners know that when interest rates are at an all time low, it’s time to make a move.”

Even if a seller gets a little less for their house than they might in the next few years, this loss is easily made up on the buying end of the transaction.

Ron continued, “Mortgage rates can make a right turn at any second.  Mortgage rates are not low because of anything that the Federal Reserve, Treasury, or Obama administration is currently doing. Mortgage rates are low because of global fear about the economy and financial system.  This causes banks and investors to hoard their cash and park it into nice, safe and boring mortgage backed securities.  You earn a very low interest rate in return for safety.  But the financial markets and the global economy will turn around, and when it does it will move mortgage rates up with it.”

Ready to buy or sell a home in Katy? To discuss selling your house or to tour Katy homes, contact me. To search all the houses currently on the market in Katy/Houston see Home Search. I have sold Katy real estate for over 20 years and would be pleased to work together.

I’ve had the busiest spring of my 21-year real estate career!s As the April 30th deadline to qualify  for the tax credits, $8,000 for first-time home buyers and $6,500 for existing home owners, loomed, home sales got really crazy.

It was not unusual for brand new listings to have multiple offers. Bidding wars ensued. Here in Katy, particularly on the southside of I-10, it was impossible to believe that a real estate recession exists.

Nationwide, the tax credit bills created a strong upswing in home sales. To read the rest of this story, see OnlyKaty.com.

Cinco Ranch was the nation’s number one master-planned community (MPC) for new-home sales in 2009, according to a report by RCLCO, an independent real estate advisory firm.

With 887 new-home sales in 2009, Cinco Ranch was one of only two Houston MPCs on RCLCO’s top 10 list to report a sales increase from the previous year.

Sales increased 14% last year in the 7,600-acre community, located at Grand Parkway and Cinco Ranch Blvd. in Katy. The increase helped Cinco Ranch grab the top spot in the study, after ranking number two in 2008 behind a Las Vegas development.

The only other Houston area community with a sales increase for 2009 was Telfair in Sugar Land, also by Newland Communities. With 450 new-home sales in 2009, Telfair ranked fourth nationally in the RCLCO study.

“These results are outstanding for us,” said Bob McLeod, Chairman and CEO of Newland Communities. “This marks the first time ever in more than 40 years we’ve had the top-selling community in the nation, and to do it during a year as tough as 2009 makes it an even bigger achievement.”

RCLCO’s study showed that total number of net sales in 2009 for the majority of the best-selling MPCs dropped from 2008 levels with sales volume declining by as little as 8% and as much as 84%. Newland’s Cinco Ranch and Telfair were a strong exception to this trend, posting increased sales for the third year in a row. Also, 2009 proved to be the best sales year ever for Telfair since opening in 2006 and the third best sales year for the 19-year-old Cinco Ranch.

“Newland’s sales success at Cinco Ranch and Telfair can be attributed to the product diversity our homebuilders offer, the proven established track records of these communities, and a highly focused marketing approach that speaks to our customer needs,” McLeod continued.

“Buyers needs have changed and they will continue to change. The communities Newland creates will continue to adapt to meet those needs. Value doesn’t just mean a lower price, or a smaller home. It means what fits their family and lifestyle needs. The way we market our communities, taking time to really understand our buyers and engaging with them on a more personal level, has changed as well,” he indicated.

Houston’s strong showing in the RCLCO study underscores the fact that the city is a bright spot in the national economy.

Ted Nelson, Central Region President for Newland Communities said, “In the past few months, Houston has ranked very high in studies ranging from the nation’s healthiest housing markets to cities where the recession is easing. Overall, the Houston communities on the top 10 list represented 2,250 new-home sales, more than double those of the second ranked metro, Las Vegas.”

RCLCO has been releasing its top-selling MPC rankings since 1994.

Cinco Ranch offers new homes priced from the $170,000s to over $1 million.

For information about all Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404 or via email. I have specialized in Katy real estate for over 20 years. Experience does count!

Firethorne sold 238 new homes in 2009, achieving a record high for annual sales for the Katy/Fulshear residential development.   Last year’s home sales represent a 16.6 percent increase over 2008 (204 homes). The previous record for the four-year-old development was 218 sales in 2007.  The 1,400-acre master-designed community is located 15 miles west of Houston’s Energy Corridor.

“We’re very pleased with these figures,” noted Firethorne General Manager Wayne Meyer.  According to Meyer, Firethorne has been holding its own thanks to continued growth in the Katy and Fulshear areas and for being part of one of the greatest school districts in the state. “BP America and Conoco/Phillips have relocated employees here, plus three major Houston hospitals are expanding in this area — two under construction and one on the drawing board,” he noted.

Firethorne has sold a total of 918 homes project-to-date. The Firethorne builder team consists of Coventry Homes, Highland Homes, Parkwood Builders, Partners in Building, Perry Homes, Plantation Homes and David Weekley Homes.

Firethorne is attractive to the Houston relocation market with its proximity to the Energy Corridor, location in the top-ranked Katy Independent School District, and availability of estate-sized lots typically found in the country with all of conveniences of master-designed recreational amenities, such as state-of-the-art technology and nearby shopping, retail, dining, entertainment, schools and medical facilities.

The community features 150 acres devoted to parks and recreational amenities, a 12-acre lake with surrounding greenbelt, resort-style swim center, sports fields, hike/bike trails, parks and playgrounds, discovery-rich wildlife observation area and a natural bird habitat.  It’s where the vibrancy of West Houston meets the small-town charm of Katy/Fulshear. Take I-10 West and exit Pin Oak to FM 1463, go to www.firethorne.info, or call 281-693-1011.

For information about Firethorne and all Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404 or via email. I have specialized in Katy real estate for over 20 years. Experience does count!

New-home sales in west Houston’s Cinco Ranch community are up 8% for the first nine months of 2009, compared to the same period in 2008.

A total of 697 new homes were sold in Cinco Ranch during the first three quarters of 2009. That compares to 643 new homes sold during the same time last year in the 7,600-acre master-planned community.

Relocation sales have remained strong in Cinco Ranch, accounting for one in three new-home sales in the community so far this year, according to Heather Gould, marketing director for Newland Communities.

“Now in its 19th year of development, Cinco Ranch has built up strong brand equity and awareness among home buyers and Realtors, which has fueled both relocation sales and local move-up sales,” Gould said.  “In the present economy, home buyers also seem to be finding a greater level of comfort in investing in a large-scale master-planned community like Cinco Ranch.”

Gould said Cinco Ranch has benefited as the largest and most established new-home community near the Energy Corridor, where employment has continued to be relatively stable. Cinco Ranch was also buoyed this summer when the Texas Education Agency gave its top accreditation rating – exemplary – to 12 of the 13 Katy Independent School District campuses serving the community.

Cinco Ranch has also expanded its new-home product offerings in 2009. In late 2008, a model home park opened to showcase the community’s most affordable new homes, priced from the $160,000s.  This fall, Cinco Ranch opened Park Place, a neo-traditional neighborhood with nostalgic architecture and prices from the $280,000s and new builders including J. Kyle Homes. The community also benefited from a custom home showcase that attracted thousands of visitors this spring.

“Offering a variety of new-home styles and price ranges, along with an expanding array of recreational amenities, has also been key to the success of Cinco Ranch,” Gould said.

I am a Cinco Ranch Specialist having sold many houses in Cinco Ranch, both new construction and resale. This includes both working as a listing and selling agent. Call me for more information and for outstanding professional representation.

Let’s look at the last six months of statistics. Below, see pricing. While, it does not show a truly positive change, it is moving upward from its recent low. Today, the average price is approximately $122,000.

Another dominant factor is days on the market, see below. How long does it take a home to sell? What is the average? As plotted below, the average days on the market in 77449 is 155. This is a decline from July’s high of 160. Some of these quicker sales represent foreclosures and short sales that do not remain on the market for long but conventional sales are doing better, too.

What’s the current status of inventory? Increasing or decreasing? Decreasing is far better for sellers. Guess what! The number of houses on the market in 77449 is going down. For a more detailed explanation of how inventory affects the market, read my earlier article on absorption rates. See the details of the inventory decline below.

To obtain detailed data on Zip Code 77450, see OnlyKaty.com.

For information about Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404 or via email. I have specialized in Katy real estate for over 20 years. Experience does count!

Local conditions are currently quite strongly in the Buyer’s Market zone with several months of inventory available at the current sales rate, buyers should find ample choice. However, inventory is no where near it’s early summer high.  For an in-depth explanation, see my earlier article on absorption rates.

Days on the market is another vital statistic when evaluating market conditions. While time for sale has steadily gone up from the low dip in June, market time has not returned to the high in early April. There is another downward turn a the beginning of this week. This bodes well for Zip Code 77494.

For information about Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404 or via email. I have specialized in Katy real estate for over 20 years. Experience does count!

Simply put, the real estate absorption rate is the formula that indicates whether it is a “buyer’s market” or a “seller’s market”. It denotes how well the market is absorbing the current inventory of listings.

The ultimate question is, “Is the current inventory level shrinking or growing?” Shrinking inventory favors sellers and growing inventory favors buyers.

Absorption rates, in any defined market, are considered one of the very best indicators of whether that market is a seller’s market, a buyer’s market or a neutral market. It is based on how many months will it take to sell the inventory currently on the market.

A seller’s market has a 1-4 month absorption rate while a buyer’s market has absorption rates greater than 7 months. A neutral market indicates 5-6 months of available inventory.

Absorption rate can be calculated in a number of ways. Certain factors are critical such as the time frame. Will the figures reflect a month’s worth of sales, a quarter, a year? In my opinion, working with six months worth of inventory to compute a month’s figure is the most useful.

If you’re end calculation equals the absorption rate for the entire Katy area, this number is meaningless. To end up with a meaningful figure break down the numbers to market segments.

Analyze the sales in a particular subdivision. Bracket related information, for example: sq-footage, age, year built, swimming pool and the like. Add a particular price range to any of these parameters.

The general rule of thumb is to divide the number of homes sold in 6 months by 6 to calculate the number of homes sold in a month. Then, take the current listings and divide by the number of homes sold in 1 month. The absorption rate equals the number of months it takes to sell a home. Here’s a random example:

Homes Sold (1000)/Months (6) = 166 homes sold per month

250 Current Listings/166 homes sold per month = 1.5 months

Using this data, the home should be sold in 1.5 months. Clearly, this example (not reflective of any particular Katy area) indicates a strong seller’s market.

For information about Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404. I offer financial incentives to my sellers/buyers. I have specialized in Katy real estate for over 20 years. Experience does count!

77450 Days on Market June Market Report

However, Days on the Market is relevant if we keep in mind that the highest priced homes are fewer in number and usually slower to sell. Less  people can afford to purchase in the highest-end price range.

High-end home sellers find that competition is tough. This buyer has a real choice, due to other extremely prestigious areas of Houston such as the Memorial Villages. While Katy schools are the greatest motivator for home purchases in our area, those who can afford million-dollar-plus homes can also afford private schools. Many chose to live closer to downtown Houston.

Still, if marketed correctly, the highest end listings will sell. Statistics prove this and sales are consistent.

The above graph represents the last six month’s data for Days on the Market. While at first glance, it appears to represent a negative shift, if you look closely you will see that the time from listing-to-contract is stabilizing. The extreme upward spike has leveled out. The great influx of spring and summer homes contribute to a longer sales period.

As far as how long a house takes to sell, an extreme  contrast exists between houses that are priced aggressively and over-priced property. Houses priced at market value sell relatively quickly. At this time of year, many sellers try to-push-the-envelope with respect to pricing.

Another factor is how the home shows. A clean, neat and uncluttered home sells far more quickly. To accomplish this important edge in selling, professional staging has grown in importance. In almost all cases, it easily pays for itself.

Six months ago there was a glut of property on the market as represented by the above chart, Inventory for 77450. By mid-March, a significant number of houses were off the market.  Some sold and others were taken off.  Numbers rose again with the traditional influx of spring and summer houses.  Inventory has stabilized in the last 45 days. There are approximately 357 homes on the market.

For information about Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404. I offer financial incentives to my sellers/buyers. I have specialized in Katy real estate for over 20 years. Experience does count!

For more specific answers, let’s look at some detailed statistics prepared today with the very latest data. The black line represents zip code 77450 and the orange line represents 77494.

Median Price in 77450: This week, the median single-family home price in Katy 77450 is $226,500. This week prices in this zip code remained relatively flat. However, the recent trends have us pulling back from the market’s high points.

Keep an eye on the Market Action Index (see below)  for a leading indicator of the duration of this downward trend. The Market Action Index answers the question, “How is the market?” It measures the current rate of sales versus the amount of the inventory.

Median Price in 77494: This week, the median single-family home price in Katy 77494 is $300,247. This week prices in this zip continued to pull back from their recent highs. Keep an eye on the Market Action Index to look for signs of an extended downward trend.

Inventory in 77450 and 77494: Local conditions are currently quite strongly in the Buyer’s Market zone. With several months of inventory available at the current sales rate, buyers should find ample choice. Being Springtime, the annual increase in listings is a part of this data.

Average Days on the Market in 77450 and 77494: Days-on-the-Market are trending downward. Even as more properties become available, these are positive trends for the market. With inventory trending up but Days-on-the-Market trending down, conditions don’t seem to have strong up or down pull.

Median Market Action Index 77450

Median Market Action Index 77494

Market Action Index 77450 and 77494: On the Market Action Index a score below 30 equals a Buyers Market. The Market Action Index is 17 in Katy  zip code 77450 and 15 in Katy zip code 77494.

For more information about Katy area homes, you can search the entire Houston MLS from this blog. For questions or to tour any area homes, contact me directly at 713-818-2404. I have specialized in Katy real estate for over 20 years. Experience does count!