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  • Writer's pictureBrooks Property Group

When will Houston Housing Prices Go Down?

Housing prices in Houston, Texas have been constantly rising for the past couple of years. Some people are wondering if this is a good thing, while others are seeing it as an opportunity to take advantage of. With that being said, there are 3 big factors that influence prices and determine how quickly they increase or decrease.

Interest Rates

One of the most important factors that influence Houston Housing Prices is Interest Rates. At its current state, interest rates in Houston for a thirty year loan are at 4%. This goes down with each passing day, and levels off around 3% once new loans come out. Along with the decrease of interest rates comes an increase in buyer demand and competition. Housing prices will remain steady or increase at their current rate until interest rates reach a level where people are not willing to invest in the market.


The lower the inventory, the higher our Housing Prices become. More specifically, housing prices go up because of low Housing Inventory and if Housing Supply remains low. Housing Inventory is the amount of homes for sale in Houston, Texas at a particular time. Housing Supply is how many available homes are for sale, though they aren't necessarily on the market.

There must be a balanced level between Housing Inventory and Housing Supply in order to have Housing Prices that remain steady or increase minimally over a certain time period. Housing Inventory and Supply work together to create Housing Prices, as Housing Inventory increases Housing Supply, and Housing Supply increases Housing Inventory. It is a constant cycle that keeps Houston Housing Prices from becoming too expensive or too inexpensive.

If Housing Inventory and Housing Supply are both high within Houston, Texas, then competition will increase as more people try to buy homes. Housing Prices will then increase drastically because of the large demand for houses. Housing prices remain high until Housing Inventory and Housing Supply levels decrease, which usually happens when other investors start to withdraw from the Housing Market.

Consumer Confidence

Another factor that influencers Houston Housing Prices is Consumer Confidence. When people are optimistic about buying a home, they invest whatever money they have into the Housing Market and Housing Prices increase. Housing Prices remain high until consumer confidence decreases and people stop buying houses. This usually happens when Housing Inventory increases and Housing Supply exceeds Housing inventory, while Housing Demand remains low.

Overall, there are several factors that influence Houston Housing prices such as interest rates, inventory, housing supply and demand, and recently the Coronavirus. Housing prices will remain steady or increase minimally until interest rates reach a level where people are not willing to invest in the Housing Market. When Housing Supply stays at its current levels and Housing Inventory increases, this causes Housing Prices to skyrocket because of an increase in consumer confidence and competition between buyers.

Buying or selling real estate

For a majority of investors and first-time home buyers, this is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.

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