In 2008, the U.S. housing market and Hurricane Ike combined to send Galveston County home sales and prices into a free fall. After surpassing 1,100 homes sold every year between 2004 and 2007, sales fell to 898 in 2008 and 755 in 2009. The average home price dropped $66,000 in a single year. Housing developments in the county that had been started — some to the point of having new streets paved — were abandoned and left unfinished.
Today, however, local and state real estate experts paint a much different, more positive picture of the local real estate market.
According to data from the Texas A&M Real Estate Center, home sales in Galveston County have increased every year since 2009, while the average amount of time that a home stays on the market has decreased by more than six months.
Analysts attribute the better market to a number of things, including low interest rates and the attractiveness of the Texas Gulf Coast, which has only increased as the memories of Ike move further into the past.
“After a couple years, people say: ‘OK, there was a hurricane; we still want to live in this area,’” said Dr. James Gaines, a research economist with the real estate center.
Gaines said the data indicate home sales should continue to increase in the coming year, though perhaps not as quickly, as the number of new petrochemical jobs, which has been a boon for the area, starts to reach its limit.
“We don’t think it’s going to stay at the same pace,” Gaines said.
Local real estate agents will take the good times while they last.
Claire Reiswerg, co-owner of Sand ’N Sea Properties in Galveston, said home sales have been fantastic in the last year, and have been spurred by growth in Texas Gulf region.
According to the Galveston Association of Realtors, home sales (including condos and lofts) on the island reached a three-year high in 2012. A majority of those sales were made on the island’s West End, from Sunny Beach to Pointe West, and in the downtown area.
“People are seeing it’s a real gem of a place to come to,” Reiswerg said.
Reiswerg said Galveston is a “huge second-home community” and has a growing reputation as “Houston’s playground.”
Another Realtor, V.J. Tramonte, agreed with the assessment, and said it’s not just people who are new to Houston who are moving to the area, it’s new Texans as well.
“It’s a little bit of everything,” said Tramonte, in discussing where people are coming from. “They’re amazed at our little island.”
According to the U.S. Census, Texas was once again one of the leading states for Americans to move to. In 2011, about 515,000 people moved to the Lone Star State, compared to the nearly 405,000 who left. The highest percentage of new Texans came from all points, including California, New York, Florida and North Carolina.
With more people, comes new challenges for home sellers, said Rick Wade, a League City Realtor.
“The buyers are still a little bit picky,” Wade said. He said that many people, especially young professionals, are looking for good school systems for their families, and that some are choosing to wait if they cannot find a good fit.
The boom times for movers might not last long however. National data indicate that the next big issue to face the housing market might be a sharp decline in the number of home on the market as demand surpasses the number of new homes being built, creating a sellers’ market and inflating prices in the still-growing Houston area.