Today, August 24, the National Association of Realtors issued the following  statement, “Existing home sales drop 27% in July; effects of expired homebuyer tax credit add turbulence to the market.”

Following the national trend, an anticipated property sales slowdown set into the Houston/Katy real estate market in July following the expiration of the federal homebuyer tax credit. The credit had propelled local home sales for four straight months beginning in March, however home sales suffered a double-digit decline in July. Despite the drop, the average price of a single-family home still managed to climb to a two-year high.

The southside of  I-10 had a 26% drop in sales for July compared to 2009 levels. The northside  of I-10 experienced a 42% drop in July closings.  As many first time homebuyers purchased on the northside, this is reflected in the slowing sales. Despite the downturn, average prices rose slightly on both sides of I-10.

According to the latest monthly data compiled by the Houston Association of REALTORS® (HAR), July sales of single-family homes throughout the Houston market fell 25.1 percent compared to July 2009. Sales volume faltered in all single-family home pricing segments except among properties under $80,000, which were flat. Sales of all property types combined slid 24.4 percent in July on a year-over-year basis.

The average price of a single-family home rose 2.7 percent from July 2009 to $224,764, the highest price since June 2008. The July single-family home median price—the figure at which half of the homes sold for more and half sold for less—dipped 0.7 percent from one year earlier to $160,880, but still recorded its highest level since July 2009.

Foreclosure property sales reported in the Multiple Listing Service (MLS) tumbled 13.5 percent in July compared to one year earlier. The median price of July foreclosure sales declined 6.1 percent to $84,000 on a year-over-year basis.

Sales of all property types in Houston for July totaled 5,056, down 24.4 percent compared to July 2009. Total dollar volume for properties sold during the month was $1.0 billion versus $1.4 billion one year earlier, representing a 23.9 percent drop.

“Homebuying came earlier and at a heftier pace than we would normally have seen in Houston during the spring and summer months because of the tax credit, but indicators showed that sales would decline once the credit expired, so this comes as no surprise,” said Margie Dorrance, HAR chair and principal at Keller Williams Realty Metropolitan. “It is encouraging that pricing has remained strong and that on a year-to-date basis home sales are actually slightly ahead of 2009 levels.”

Houston and surrounding areas month-end pending sales for July totaled 3,267, down 16.4 percent from last year, suggesting that sales will be down again in August. The months inventory of single-family homes for June extended to 7.7 months compared to 6.5 months one year earlier, but remains healthier than the national months inventory of single-family homes of 8.9 months, reported by the National Association of REALTORSâ (NAR).

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!

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!

Watch for persistent downward shift in the Market Action Index, available on my weekly subscription service, see order form. The buyer’s zone is a leading indicator of the price strength sustaining.

Pertaining to supply and demand, local conditions are currently quite strongly in the Buyer’s Market. Again, see my highly detailed report available through a free subscription. The 90-day Market Action Index stands at 16. With several months of inventory available at the current sales rate, buyers should find ample choice.

Zip Code 77494: For highly detailed market reports, order my free Market Report newsletter; order form to the left.

The median single family home price in Katy 77494 this week is $299,900. Inventory has been tightening and days-on-market decreasing recently.

The Market Action Index has been basically flat, not providing strong indication for market conditions. We continue to see prices in this zip code hovering around their high point. Look for a persistent down-shift in the Market Action Index before we see prices deviate from these levels.

Local conditions are currently quite strongly in the Buyer’s Market zone. The 90-day Market Action Index stands at 15. Charts available in my free newsletter. With several months of inventory available at the current sales rate, buyers should find ample choice.

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 offer financial incentives to my sellers/buyers. I have specialized in Katy real estate for over 19 years. Experience does count!

You will find this data on my new “live” page, How’s the Market?. For far more detailed data, you can subscribe to my free weekly market report. The subscription link is found on the How’s the Market page.

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 have specialized in Katy real estate for over 20 years. Experience does count!