Texas' available housing stock saw its first quarterly increase in in three years in the second quarter, giving a boost to sales volume as demand remains strong.
The Texas Association of Realtors released Friday its 2014-Q2 Texas Quarterly Housing Report, revealing a 5.9 percent quarterly pickup in home inventory to a months' supply of 3.60—level with where supply figures were at the end of 2013.
Despite the quarter-over-quarter increase—the first since 2011, the association reports—inventory remained down 12.2 percent compared to a year ago, holding back growth in home sales.
"The statewide housing inventory shortage to date in 2014 has prevented Texas from seeing the double-digit increases in home sales growth that we saw last year, so this new increase in inventory is promising," said Dan Hatfield, chairman of the Texas Association of Realtors. "However, home sales volume continues to keep pace with 2013—the second-best year ever for Texas real estate—showing that housing demand continues to be very strong throughout the state."
According to the group, this year's second quarter saw 81,272 home transactions, an increase of nearly 50 percent over the slower first quarter and 1.1 percent over Q2 2013.
In the same period, the median price for homes sold in Texas was $187,300, up 8.3 percent quarter-over-quarter and 5.9 percent year-over-year.
With demand remaining steady and inventory still below a balanced market, more development will be needed to see real growth, said Jim Gaines, Ph.D., economist with the Real Estate Center at Texas A&M University, which compiles each quarter's housing report.
"The development of new homes and vacant lots is on the rise throughout Texas, and as a result we're seeing much-needed gains in inventory. That said, Texas is still facing an inventory shortage," Gaines said. "A steady, ongoing supply of new housing stock—particularly in the first-time and move-up buyer market, where a majority of home sales volume occurs—will be crucial to Texas housing market growth in the second half of 2014 and in the future."