In March, there was a drop year-over-year in new home closings in the Houston, TX market, but there were signs the market may be leveling out from a percentage fall less than February 2016. New home closings saw a decline of 7.3% from the year earlier to 2,112. This followed a 8.7% fall year-over-year in February.
A total of 25,418 new homes were sold during the 12 months that ended in March, down from 25,585 for the year that ended in February.
Out of all housing closings, new home closings accounted for 20.3%. A year ago, new home closings represented 21.0%. Closings of new and existing homes declined year-over-year in March after also falling in February year-over-year.
Pricing and Mortgage Trends
The average per-unit price of newly sold homes rose year-over-year to $326,698 in March, up 1.8% from last year. This gain is smaller than the 2.0% bump in February year-over-year.
For newly sold homes, the average mortgage size gained year-over-year along with new home prices. The average mortgage size rose to $281,546 in March, marking a 1.9% boost compared with a year earlier. Average mortgage size rose 2.2% in February 2016 from a year earlier.
Other Market Trends
Closings of attached units, as a percentage of new home closings, have risen from last year while closings of single-family homes have fallen. The share of new home closings belonging to attached units gained from 1.6% of closings in March 2015 to 3.1% of closings in March 2016. At the same time, the share belonging to single-family homes dropped to 96.9% of closings from 98.4% of closings.
There was a 6.6% rise year-over-year in the average unit size of newly sold homes to 3,136 square feet in March 2016. The average size of newly sold homes moved from 2,838 square feet in February 2015 to 3,215 square feet in February 2016. An increase in both the average size and price of newly sold homes was also seen in February 2016 when the average size jumped 13.3% to 3,215 square feet.
Foreclosures and real estate owned (REO) closings continued to fall from a year earlier in March, but did not appear to be dragging the market. Combined, foreclosures plus REO closings represented 11.0% of existing home closings, below 15.2% a year earlier. The percentage of existing home closings involving foreclosures declined to 5.1% in March from 7.3% a year earlier while REO closings as a percentage of existing home closings sank to 5.8% from 7.9% a year earlier.