As the 4th most populous city within the United States, Houston, the “Bayou City” has been a hot relocation destination for individuals and families across the country.
With many larger corporations relocating headquarters to take advantage of the pro-business regulations in place throughout Texas, individuals from states like California, New York, and Louisiana continue to flock to H-Town.
There has also been a massive influx of Texans from cities such as Austin and Dallas as they look to take advantage of the more affordable living costs which has led to a booming real estate market.
In 2021, homes in Houston appreciated by an average of 17.6% – quickly making one of the most affordable housing markets in the nation less affordable.
Home Price Appreciation over Past Year Compared with Historical Avg
One of the largest reasons behind the record home price appreciation over the past year is the lack of housing inventory available for prospective home buyers. Since the onset of the pandemic in early 2020, the supply of homes available for sale has been significantly below historical averages.
Currently, housing inventory in Houston sits at historically low levels. This means there are far fewer homes available for sale in this market than there typically would be. While many home builders have increased their footprint in Houston to help alleviate the inventory crunch, it will likely take a few years for those newly built homes to alleviate the pressure on home buyers.
Downward Housing Inventory Trend over Past 2 Years
With the FED raising interest rates, the cost of a home loan will become more expensive too causing a scramble of home buyers to enter the market now to avoid the higher costs of financing.
This hyper-competitive market has led to a dramatic increase in the amount of offers being placed on each listed home resulting in 31.6% of homes selling above their list price.
In a market where there are multiple offers being placed on homes, it is essential that your offer is able to stand out when compared with that of the competition.
While the purchase price is likely the most important part of any offer, there are other ways you can differentiate your offer from the crowd.
Studies have shown that cash offers are 4x more likely to be accepted than a financed offer in today’s competitive environment. Terms such as waived appraisals, waived option periods, and quick/flexible closing timelines also play a key role.
Houston’s real estate market is booming
At Divvy, our offers are designed to help us stand out from the rest of the competition. Every offer has the following terms:
- 100% Cash
- No Appraisal Contingency
- Closing as quickly as 2 weeks
- Waived Option Period on eligible homes
Since the beginning of 2022, Divvy has won over 67% of the offers presented to sellers throughout Houston. In a market where 31.6% of homes currently are selling above their list price and home buyers are having to go through the gauntlet of offering on several homes to finally win an offer, the majority of Divvy customers are able to move into the first home they choose to offer on.