2013 Real Estate Market Starting Out with a Bang

2013 has been a busy year so far for real estate in Montgomery County.  Too determine how busy, I decided to dive into the MLS database to see how the residential market for single family homes has been performing.  I was not surprised to see that sales through mid-March in Montgomery County were up over 15% compared to the same 75 day period last year.  Additionally, the median price per square foot rose about 10% and homes sold about a month faster compared to last year.

Most folks believe that the new Exxon campus in north Harris County has had a large impact on the local market.  In digging a little deeper into the year to year comparison, I can see that most of the increase in sales is in the areas nearest the Harris County line.  In fact, of the 151 increase in home sales year to year, 117 occurred in the southwest part of the county.  This is also where the homes are selling the fastest, with home sellers securing a buyer an average of only 45 days after listing their home.  This is about a month faster when compared to last year.  In the last year, the data indicates that southwest Montgomery County has gone from a good sellers’ market to a strong sellers’ market.   

I was recently told by a client relocating from Exxon’s Virginia office that they have been advised to look for homes in The Woodlands,  Spring or Tomball area.  So it’s not surprising that The Woodlands is taking the lead in Montgomery County’s increased demand for housing.  But like my client relocating from Virginia, there are a number of families that prefer the charm of many of the older neighborhoods and the more tranquil areas found in the northern part of the county.  And what some are discovering is that the commuting time to some of these more northern neighborhoods is actually less than the time it takes to get to some of the neighborhoods situated deep into The Woodlands.

In checking into some of the stats for a few Conroe neighborhoods located close to I-45, I found out that 4 of the 5 homes sold in Rivershire so far this year were on the market less than 2 weeks.  Last year during the same time period, 2 of the 3 homes sold in Rivershire were on the market 6 months and more.   Granted, there were only a few homes sold during both time periods, but the rapid pace they sold this year could be an indication that the increased demand in housing is spreading north.  I noticed that River Plantation and Stewart’s Forest also showed substantial improvement.  So there is reason for optimism for home sellers throughout Montgomery County.

There are obviously still lots of concerns about the overall housing market and about the overall national economy in general.  But there are some systemic changes in Montgomery County that seem, at least to this humble Realtor, to have some staying power.  Time will tell, but for anyone that is considering buying a home in this area, you might not want to wait too long.  Increased demand typically increases prices, especially in the short term before new construction catches up with the demand. 

Home Inspections

I heard a story about the wife of a junior high school principal who bought her husband a tie for Christmas.  She selected one with a subdued pattern with colors that complemented his favorite suit.  She didn’t notice until after she started wrapping it that the pattern consisted of numerous silhouettes of shapely women.  Fortunately, it was noticed before the tie was worn to school, as I can just imagine all the young boys acting up in class hoping to get sent to the principal’s office!

I think most of us have purchased an item or two that turned out to be a little different than what we expected.  And often it is because we missed an important detail.  When it comes to real estate, there are so many details that it is next to impossible for the average homebuyer to examine and understand each and every one.  That is why home inspections are so important.  Missing an important detail on a home purchase can be a costly mistake.

Home inspectors are licensed by the Texas Real Estate Commission (TREC) and have completed education and training in home inspections.  A typical home inspection covers a home’s structure, electrical system, heating and air conditioning system, plumbing system, appliances, as well as certain other improvements in place such as lawn irrigation.  The minimum level inspection as defined by TREC is a “limited visual survey and basic operation of the systems and components of a building using normal controls and does not require the use of specialized tools or procedures”.  TREC further states that “the purpose of the inspection is to provide the client with information regarding the general condition of the residence at the time of inspection”. 

Of course, some inspections offer services above and beyond what is required by TREC.  But that additional level of service might come with a higher service fee.  Regardless, licensed inspectors methodically examine the exterior and interior of the home and almost always find some issues that the buyer should take into consideration.   Sometimes a report might recommend hiring a specialist, such as a licensed HVAC technician, to do a more detailed analysis on an area of specific concern.

A Realtor should always recommend to their client that they purchase an option period for a specific time period to “kick the tires”.   During the option period, a client can back out of the contract at any time for any reason.  It is during the option period that the home inspection is done as well as other due diligence such as a termite inspection.  Most times, the home inspection report does not reveal issues that cause a buyer to exercise their option to terminate.  Typically there is one of three outcomes; the seller agrees to address all requested items on the inspection, the buyer agrees to accept the property as is, or most commonly, the seller agrees to make some, but not all, requested repairs.

When I purchased my first home several decades ago, the inspection report consisted of three items scribbled on a half sheet of notebook paper.  Those days are long gone.  Nowadays, inspectors are licensed and required to issue an inspection report that provides assurance to a buyer that a trained professional has inspected the home according to state mandated procedures.  Of course there are no guarantees, but a home inspection is one of the most important tools to help prevent buyer’s remorse. 

The junior high school principal’s wife had an easy solution to her problem.  She just took the tie back and exchanged it.  But overlooking an important detail in a home can have much more foreboding consequences.  So be sure to always have an inspection done before purchasing a home.