Real Estate Reality: Housing Market Slows to a Crawl | NewsRadio 740 KTRH | KTRH Local Houston and Texas News

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The combination of high interest rates and low supply has dragged the housing market to its lowest pace in more than a decade. Sales of existing homes nationwide fell by 3.3% in June from a month ago, but are down nearly 19% from a year ago. That marks the slowest June in the housing market since 2009. At the same time, the supply of homes for sale dropped by more than 13% in the past year, while the average rate on a 30-year fixed mortgage remains well above 7%.

Taken together, all of this data sounds disastrous, but experts say it’s actually just a massive market correction. “We’re slowly easing into a healthier, more steady market,” says Tyler Kreis, owner of Texas-based TK Realty. “The market we were in in 2021 and 2022 was insane.”

As an example, Kreis cites the aforementioned supply issue. “In ’21 and ’22 we had like two weeks of inventory, now we’re sitting at two to three months of inventory,” he tells KTRH. “And I think that number is going to tick up as we get out of the busy summer season and enter October, November and December.”

The other factor pointing to stability in the market is prices, which have remained high despite the drop-off in sales activity. “In the Houston market, even though year-over-year we’re down almost 10 percent for closings, our sales prices have only gone down 2.5 percent,” says Kreis. “That’s a positive, especially with how fast we appreciated over the last two years.”

While interest rates will remain high at least into next year, Kreis doesn’t foresee any major momentum swings in the market in the near future. “I think (the market) is going to stay stable,” he says. “I think supply will improve, but I don’t see sales prices drastically dipping, and I don’t see them increasing either.”

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