Houston-The Woodlands-Sugar Land, TX Federal Housing Finance Agency Home Price Index (FHFA HPI)

In the fourth quarter of 2019, the Houston-The Woodlands-Sugar Land, TX Federal Housing Finance Agency (FHFA) house price index (HPI) was 179.4, up 1.4 percent from the third quarter of 2019 and up 7.0 percent from the fourth quarter of 2018. The FHFA HPI is a broad measure of changes in home prices in the Houston-The Woodlands-Sugar Land, TX metropolitan area.

On a quarterly basis, the Houston-The Woodlands-Sugar Land, TX FHFA HPI increased 1.4 percent in the fourth quarter of 2019. This was the fourth consecutive quarter of positive growth and the highest quarterly growth rate since the fourth quarter of 2017. On an annual basis, the index was up 7.0 percent in the fourth quarter of 2019, the highest annual growth rate since the fourth quarter of 2015.

The Houston-The Woodlands-Sugar Land, TX FHFA HPI is based on sales prices of homes financed with conforming conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac. The index covers single-family homes and condominiums, but excludes homes with government-insured or guaranteed mortgages, such as those insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA).

In the fourth quarter of 2019, the Houston-The Woodlands-Sugar Land, TX FHFA HPI was boosted by strong gains in the value of both single-family homes and condominiums. The single-family home index was up 1.5 percent from the third quarter of 2019 and up 7.3 percent from the fourth quarter of 2018. The condominium index was up 1.1 percent from the third quarter of 2019 and up 5.7 percent from the fourth quarter of 2018.

The appreciation in home values in the Houston-The Woodlands-Sugar Land, TX metropolitan area has outpaced the national average in recent years. From the fourth quarter of 2014 to the fourth quarter of 2019, the Houston-The Woodlands-Sugar Land, TX FHFA HPI rose 33.2 percent, while the national FHFA HPI rose 27.8 percent.

The strong growth in home values in the Houston-The Woodlands-Sugar Land, TX metropolitan area has been driven by a number of factors, including strong job and population growth, low interest rates, and limited supply of housing.

job growth in the Houston-The Woodlands-Sugar Land, TX metropolitan area has been strong in recent years. Between December 2014 and December 2019, the metro area added an average of 79,700 jobs per year. This is an annual growth rate of 2.9 percent, which is well above the national average of 1.6 percent.

The population of the Houston-The Woodlands-Sugar Land, TX metropolitan area has also been growing rapidly in recent years. Between 2010 and 2018, the metro area’s population grew by 14.4 percent, from 6.1 million to 6.9 million. This is more than double the national average population growth rate of 5.3 percent during this period.

The combination of strong job and population growth has led to strong demand for housing in the Houston-The Woodlands-Sugar Land, TX metropolitan area. This has helped to drive up home values.

In addition to strong job and population growth, low interest rates have also helped to boost home values in the Houston-The Woodlands-Sugar Land, TX metropolitan area. Low mortgage rates make it more affordable for people to buy homes and also make it more profitable for investors to buy and hold properties.

The average 30-year fixed-rate mortgage rate in the United States was 3.75 percent in the fourth quarter of 2019. This is down from 4.54 percent in the fourth quarter of 2018 and down from the recent high of 4.87 percent in the third quarter of 2018.

The combination of strong job and population growth, low interest rates, and limited supply of housing has led to strong appreciation in home values in the Houston-The Woodlands-Sugar Land, TX metropolitan area. This has been good news for homeowners in the metro area, as their equity has grown rapidly in recent years.

Between the fourth quarter of 2014 and the fourth quarter of 2019, the median home value in the Houston-The Woodlands-Sugar Land, TX metropolitan area rose from $182,000 to $271,000, an increase of 48.4 percent. During the same period, the national median home value rose from $176,700 to $248,000, an increase of 40.2 percent.

As home values have risen, so has the amount of equity that homeowners have in their homes. In the fourth quarter of 2019, the median home equity in the Houston-The Woodlands-Sugar Land, TX metropolitan area was $154,000, up from $122,000 in the fourth quarter of 2018. This is an increase of 26.2 percent.

The rise in home values and equity has been good news for homeowners in the Houston-The Woodlands-Sugar Land, TX metropolitan area. However, it has also made it more difficult for first-time homebuyers to afford a home in the metro area.

The median sales price of a home in the Houston-The Woodlands-Sugar Land, TX metropolitan area was $269,000 in the fourth quarter of 2019. This is up from $257,000 in the fourth quarter of 2018, an increase of 4.4 percent.

The median household income in the Houston-The Woodlands-Sugar Land, TX metropolitan area was $75,000 in the fourth quarter of 2019. This means that the median home price was 3.6 times the median household income in the metro area.

The affordability of housing in the Houston-The Woodlands-Sugar Land, TX metropolitan area has deteriorated in recent years as home prices have risen faster than incomes. In the fourth quarter of 2014, the median home price in the metro area was 3.2 times the median household income.

The combination of strong job and population growth, low interest rates, and limited supply of housing has led to strong appreciation in home values in the Houston-The Woodlands-Sugar Land, TX metropolitan area. This has been good news for homeowners in the metro area, as their equity has grown rapidly in recent years. However, it has also made it more difficult for first-time homebuyers to afford a home in the metro area.