AUSTIN, July 8, 2016 -- Condominium sales in Texas' major metro areas increased and town home sales fell in the first half of 2016, according to the Texas Condominium Mid-Year Sales Report. Released Friday by the Texas Association of Realtors, the report shows that condominium sales in Texas' four largest markets have seen increasing demand over town homes and single-family homes among young professionals and retirees. This is the first time in the report's history that condo and town home statistics have been reported separately.

According to the report, Austin, Dallas, Houston and San Antonio all experienced an increase in condo sales between January and May 2016 compared to the same six-month period last year. Town homes in the major Texas metros saw a slight decrease year-over-year.

A 2 BR, 2 bath condo in this building in Northwest Dallas is on the market for $215 K.
A 2 BR, 2 bath condo in this building in Northwest Dallas is on the market for $215 K.

In Austin, 1,178 condos were sold between January and May 2015, a 12% decrease from the same period in 2014. Median price increased to $222,000, a 4% gain from the year prior. New listings rose two percent to 1,904 listings, whereas active listings jumped 14% to 623 listings and pending sales dropped four percent to 1,496 sales from January to May. Finally, average days on the market fell to 43 days, an 8% decrease from the year prior.

In Dallas, 2,454 condos were sold between January and May 2015, a 3% increase from the same period in 2014. Median price increased to $171,020, a 7% gain from the year prior. New listings decreased three percent to 3,366 listings, whereas active listings dropped 20% to 1,101 listings and pending sales rose 11% to 2,618 sales from January to May. Finally, average days on the market dropped to 48 days, a 22% decrease from the year prior.

In Houston, 2,668 condos were sold between January and May 2015, a 1% decrease from the first half of 2014. Median price remained unchanged at $145,000 during the same time frame. New listings increased seven percent to 4,471 listings, whereas active listings increased two percent to 1,490 listings and pending sales rose 25% to 2,126 sales from January to May. Finally, average days on the market dropped to 51 days, a nine percent decrease from the year prior.

In San Antonio, 288 condos were sold between January and May 2015, a 6% increase from the same period in 2014. Median price increased to $189,900, a 9% gain from the year prior. New listings decreased 12% to 467 listings, whereas active listings dropped 21% to 302 listings and pending sales rose 6% to 284 sales from January to May. Finally, average days on the market dropped to 89 days, a 7% decrease from the year prior.

"Many young urban professionals and newly retired baby boomers are buying condos, as they provide an affordable alternative to single-family homes and town homes," said Leslie Rouda Smith, chairman of the Texas Association of Realtors. "These millennials and retirees don't want the upkeep of a traditional, single-family home and want to be close to nightlife and amenities."

Condos showed double-digit gains in median price in three of the four metro areas in the first half of 2016, with the exception of Austin. Town homes saw smaller price increases in three metro areas, with San Antonio experiencing a slight decrease. While the median price of condominiums and town homes is still lower than single-family homes in most areas, the price-per-square-foot is significantly higher.

"A challenge facing new Texas condo and town home developments is that these types of housing, similar to single-family, are generally not being built for under $200,000 due to high land and labor costs," said Jim Gaines, chief economist with the Real Estate Center at Texas A&M University. "However, the older, existing condos are typically the predominant properties left in Texas' major metro areas that can be purchased for under $200,000, the price range best suited for first-time, entry-level home buyers."

Smith concluded: "Housing affordability is becoming a big issue in Texas. That's why Texas Realtors have worked tirelessly this summer to encourage Congress to pass a bill that increases the number of condos that are eligible for FHA financing. That legislation, already passed unanimously by the House and now under consideration by the Senate, would be the positive step many Texans need to own a condo of their own."