Cypress Edition | July 2023

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MARKET SNAPSHOT See how Cy-Fair’s housing market has performed since 2021.

Houston and surrounding counties, … is actually booming. That’s one of the areas we are starting to see a lot of growth,” said Cathy Trevino, chair of the Houston Association of Realtors. As developers continue building out the Cypress community, inven- tory in the Cypress South submarket increased from 96 homes in January 2022 to 565 this April. Mortgage rates, prices plateau Jill Smith, a local real estate agent for Compass Realty, said she believes some buyers are waiting because of perceived economic uncertainty and higher interest rates. However, inter- est rates are not likely to change dra- matically in the near future. “I think people did start to realize that 6% and 7% are the new normal. Are we ever going to see 2% again? Probably not. Will interest rates go down at some point? Yes,” she said. Rising home prices and mortgage rates along with home appreciation gains, and increases in property taxes and homeowners insurance costs have reduced aordability in Cy-Fair by 30%-40% in the last ve years, said Mitch Medigovich, a mortgage lender with The Wood Group of Fairway Independent Mortgage. The average price of homes sold in Cy-Fair in the rst quarter of 2020 was $288,210, according to the Texas Real Estate Research Center, and was $402,628 in the rst quarter of 2023. Home prices jumped 13.7% from 2020-21 followed by another 20.8% between 2021-22. But from 2022-23, the increase slowed to 1.7%. The National Association of Real- tors’ Housing Aordability Index is based on home prices, interest rates and wage growth. The baseline score of 100% indicates households earning

the median income can aord the median home price with a 20% down payment. Higher scores indicate homes in the area are relatively more aordable for its residents. Medigovich said the local aord- ability index was 152% in 2018 but is now approximately 113%. “The latter part of 2022, we saw mortgage interest rates hit 30-year highs, further fueling market uncer- tainty,” Medigovich said. “We’re actu- ally seeing [loan application] activity increase with the rates as they are now, and if we see the lower rates which have been forecasted to be about 1% lower than they are now, we should also see greater demand for housing.” Because of limited inventory, rental prices are going up while home pric- ing is slightly lower than this time last year in the Greater Houston market as a whole, Trevino said. “We’re still sitting at 2.7 months of inventory [in the Greater Hous- ton market]. That’s still not enough inventory to be a balanced market. A balanced market is more like six months,” she said. Months of inventory shows how long it would take for all homes on the market to sell at the current pace of sales. As of April, the Coppereld area had 1.1 months of inventory, while neighborhoods in Cypress North had about 1.4 months. However, Cypress South had higher inventory levels at 3.4 months. New home loan strategies Smith said she believes buyers should focus on the aordability of their monthly payments rather than mortgage rates or the cost of homes. “During the height of everything, prices were going up 10%-15%. They’re expecting this year and probably next

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Cypress North Cypress South Coppereld

HOME SALES Home sales are trending up this year after dipping in late 2022.

50 100 150 200 250

AVERAGE HOME PRICES The average local home price has remained above $400,000 in Cy-Fair this year.

$600K

$400K

$200K

HOME INVENTORY The number of homes on the market is rising locally with most listings in Cypress South.

2021

2022

2023

200

400

600

800

1,000

SOURCE: TEXAS A&M UNIVERSITY’S TEXAS REAL ESTATE RESEARCH CENTERCOMMUNITY IMPACT

9212 Fry Rd., Suite 100 Cypress, TX 77433 713.852.6700 TexasBayCU.org

COMMUNITYIMPACT.COM