2025 News Archive

According to Zonda, in 2Q25, the Houston market saw New Home Lot Supply Index (LSI) hit 71.8, signifying that the Houston market is still significantly undersupplied. While the LSI index was up 21% year-over-year, builders have slowed production due to economic uncertainty and oversupply of homes for resale. Single-family home closings totaled 8,588 in June 2025, a 12.5% increase compared to the same period in 2024, reflecting a late-quarter boost in buyer activity. However, the market is also experiencing growing housing inventory, with active listings reaching 59,492 in July, the highest on record for Houston and a 27.2% increase from the previous year. This surge pushed months of available inventory to 5.4, up from 4.2 a year ago. In Texas, builder activity also slowed in 2Q25 as softer demand and rising resale inventory reduced the pace of lot-to-start conversions. In May, Houston and Dallas accounted for nearly 80% of Texas' new residential permits, though overall activity remained below peak growth periods.

The Houston housing market showed positive growth in 1Q25, with a slight increase in new home starts and closings. The annualized pending home sales rose by 12.7%, reaching 9,165 in March 2025, while single-family home closings increased by 2.6%, totaling 7,429. The average home price climbed to $427,221, reflecting a 3.7% year-over-year growth. Today's strong home activity serves as a leading indicator for future land demand rather than a reflection of current land sales and value performance. It typically takes 2-3 years to convert raw land into builder-ready lots, and 6-18 months for construction. Additionally, the unemployment rate stood at 4.2%, while employment growth remained strong, with a 2.4% increase in total nonfarm employment. These economic indicators signal a healthy, expanding market, with continued demand for land and housing development.

In 4Q24, Houston's land market experienced significant growth in the outer suburbs, with Brookshire leading a 144% surge in home sales, largely due to new master planned developments like the Sunterra community. Other areas such as Porter/New Caney West, Conroe Northeast, Waller, Fulshear/South Brookshire/Simonton, and Hockley also saw increased land sales, driven by affordable home prices and new construction. December 2024 saw a notable 16.3% year-over-year increase in single-family home sales, with 7,162 units sold that month. Active listings grew by 21.6%, reaching 45,714 properties, contributing to a balanced market with a 4.0-months supply of inventory.