Closings of new homes in the Houston, TX market dropped year-over-year in January, and there were hints the market may be worsening with a percentage drop steeper than that of December 2015. There was a 10.7% decline in new home closings from a year earlier. This followed a 4.9% drop year-over-year in December.
A total of 25,315 new homes were sold during the 12 months that ended in January, down from 25,466 for the year that ended in December.
New home closings made up 19.6% of overall housing closings. This is a bump from 17.8% of closings a year earlier. Following a year-over-year decline in December, closings of new and existing homes also slid year-over-year in January.
Pricing and Mortgage Trends
The average price of new homes was $320,548 per unit in January, up 5.8%from a year earlier. This lift is higher than the 1.3% boost in December year-over-year.
The average mortgage size on newly sold homes saw a bump year-over-year along with new home prices. It climbed 6.0% in January from a year earlier to $274,951. In December 2015, average mortgage size on newly sold homes saw a 2.0% surge year-over-year from a year earlier.
Other Market Trends
There has not been much movement in the composition of the market with regard of the types of properties sold. From a year ago, single-family home closings have moved from 97.8% of new home closings to 98.3% of closings while attached units have gone from 2.2% of closings to 1.7% of closings.
The average unit size of newly sold homes rose 2.1% year-over-year to 2,918 square feet in January 2016. The average size of newly sold homes moved from 2,923 square feet in December 2014 to 3,295 square feet in December 2015. An increase was also seen in December 2015 when the average size of new homes sold jumped 12.7% to 3,295 square feet.
Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in January, but did not look to be a burden on the market. Out of all existing home closings, foreclosures combined with REO closings made up 14.0% of closings, below 19.9% a year earlier. The percentage of existing home closings involving foreclosures slid to 7.5% in January from 11.4% a year earlier while REO closings as a percentage of existing home closings fell to 6.5% from 8.5% a year earlier.