The multi-family properties market in Harris County has experienced significant changes in May 2024 compared to the same period in 2023. Here's a detailed analysis of the market trends for properties with 1-5 units and larger multi-family units.
1. Multi-Family Properties with 5+ Units:
Market Dynamics:
- Increase in Listings: The number of houses for sale surged by 40.9%, reaching 186 properties in May 2024, compared to the same period in 2023.
- Decrease in Sales: The number of sold properties decreased by 33.3% over the same period.
- Price Trends: The average price per square foot (SF) decreased by 8.2%, bringing it down to $179/SF.
- Average Sold Price: The average sold price in May 2024 was $524,167.
- Inventory Supply: The Months Supply of Inventory stood at 7.3 months, indicating a market slightly favoring buyers.
Market Implications: The increase in listings coupled with a significant drop in sales suggests a shift towards a buyer's market. The downward trend in the average price per SF over the past 12 months reinforces this, indicating potential opportunities for buyers to negotiate better deals. Sellers may need to adjust their pricing strategies to attract buyers in this changing market landscape.
2. Multi-Family Properties with 1-4 Units:
Market Dynamics:
- Increase in Listings: The number of for-sale properties increased by a remarkable 61.3% in May 2024 compared to May 2023.
- Decrease in Sales: There was a 17.3% decrease in the number of sold properties during the same period.
- Price Trends: Contrary to the trend in larger multi-family properties, the average price per SF for 1-4 units increased by 12%, reaching $187/SF.
- Average Sold Price: The average sold price was $432,616 in May 2024.
- Inventory Supply: The Months Supply of Inventory was 6.6 months, indicating a balanced market.
Market Implications: The significant increase in listings suggests a growing supply, while the decrease in sales points to a cooling demand. However, the rise in the average price per SF indicates that smaller multi-family units are still commanding higher prices, potentially due to their accessibility and lower entry costs for investors. The balanced Months Supply of Inventory reflects a market equilibrium, making it an opportune time for both buyers and sellers to engage in transactions.
Conclusion:
The Harris County multi-family properties market in May 2024 presents a mixed bag of opportunities and challenges. For larger multi-family properties (5+ units), buyers have an upper hand with increased supply and lower prices. On the other hand, the market for smaller multi-family properties (1-4 units) remains balanced, with prices still on the rise despite a slowdown in sales. Both buyers and sellers should stay informed about these trends to make strategic decisions in this dynamic real estate environment.
