Condo Sales Slow, But Demand is Still High Says Texas Association of Realtors Report

Condo sales are still brisk compared to last year, but sales have decreased an average of one percent between January and May of 2015, says the Texas Association of Realtors‘ recent report. Using data from the Real Estate Center at Texas A&M University, The 2015 Texas Condominium Mid-Year Sales Report shows that condo and townhome sales are flat or slipping in the four largest markets.

With runaway demand, Austin still leads the price-per-square-foot category, while condo sales actually decreased 12 percent year-over-year in the state capital. Both Dallas and San Antonio posted modest gains of 3 and 6 percent, respectively. Houston condo sales dipped just 1 percent from the same time last year. Jump for more interesting stats.

“The rapid pace of Texas’ housing market growth has slowed in the last year, and that includes the condominium and townhome market,” said Scott Kesner, chairman of the Texas Association of Realtors, in a news release. “However, the demand for condos remains strong, as condos continue to spend less time on the market and sell at higher prices. Those higher prices, however, could be impacting some Texas homebuyers’ ability to afford condos, especially in our state’s metro areas.”

Graphic: Texas Association of Realtors

Prices, like single-family homes in Texas’ major metro areas, are up for condos and townhomes. In Dallas, the median price for a condo or townhome increased to $171,020, a 7 percent gain from January to May of 2014. Average days on the market dropped to 48 days, a 22 percent decrease from the year prior, so condos are still moving rather quickly. However, the market for new condos and townhomes is rather saturated with luxury inventory, which is out of reach for many Dallas homebuyers.
“The land and development costs for condominiums in Texas’ metro areas are so high that new condos being built today are priced outside of an affordable price range for many first-time homebuyers and buyers with lower household incomes,” said Jim Gaines, Ph.D., economist with the Real Estate Center at Texas A&M University. “Existing condos, by comparison, are priced significantly less than new condos and therefore have a much higher demand and tighter inventory. In several of Texas’ metro areas, existing condos and townhomes are driving sales in that segment of the housing market.”What are your impressions of the condo and townhome market in your area?