Harvey continues to affect housing market

Published 11:19 am Tuesday, July 3, 2018

By Ginger Broomes

The Orange Leader


Orange County’s real estate market continues to take a hit 10 months after Harvey. Sales price of a home in May 2018 compared to a year ago has fallen by more than 15-percent, according to statistics released from the Beaumont Board of Realtors. Orange County Realtors are a part of the organization.

According to Ben Rodriguez, president of Beaumont Board of Realtors, there are still many homes that remain “flooded and gutted”, the term for homes left unrenovated after the storm.

“The big factor in Orange County is we’re still selling homes that are gutted out,” Rodriguez said. “Orange County has the least amount of inventory. Sellers are selling a shell and walking away.”

Active listings are down by 24-percent and 23.2-percent fewer sales were closed for May 2018 versus a year ago. However, the homes that are available are staying on the market for a shorter period of time, averaging about a week less than last year. Fewer listings makes for higher demand for what is available.

The median sales price for a home in Orange County in May was $134,900, and most homes that sell are in the 100k to 200k range.

There is some good news however, at least for sellers and investors.

“Prior to Harvey, homes were on the market 3 or 4 months before selling, and sellers had to make concessions (paying buyer’s costs, etc.), to sell,” said Rodriguez. “Now we’re seeing multiple offers on completed properties after Harvey.”

The “flooded and gutted” homes are the big market for investors.

Less concessions are good for sellers, not so much for buyers. Sellers don’t have to offer closing cost assistance to sell, again because of the limited supply of homes and the high demand.

“Inventory is low, and we’re seeing interest rates creeping up.” Rodriguez said he expects to see interest rates into the mid-5%s by next year.

Rodriguez sees this could improve but could take a minimum of a two-year process for the market to recover after the storm.

As far as what should buyers or sellers should expect, Rodriguez says the best thing is to contact a realtor, who knows exactly what the market is doing, because the market changes and every situation is different.

“There are still great financing opportunities for buyers. Grants, VA loans,” Rodriguez said. “But buyers should expect to bring more money to the table (for closing costs).”