The 2024 selling season in River Oaks is not yet truly underway. It’s just running late – by about six weeks.
It is always interesting to note the differing reactions from colleagues when a quiet month or two goes by at a time of year when the market should really be cracking. (See graph below.)
The high-energy types, who are typically latched to their smartphones day and night and who thrive on constant feedback, have been anxious about the radio silence.
The laid-back veterans – sometimes a little too laid back – have been quick to point out that it’s Spring Break this week for many, and Easter is coming right up. “Things will pick up soon after that.”
We helpfully mention that there have already been plenty of excuses, with Martin Luther King Day, St. Valentine’s Day, Presidents’ Day and the Rodeo cookoff each resulting in market droop. And Tax Day is just around the corner. That’s always a downer.
Cause for pause
The old-timers have a point. Stubbornly high interest rates have dampened the spirits of many buyers, and sellers, especially those who elect to borrow money to purchase real estate. And they are using any excuse they can find in early 2024 not to jump fully into the market.
The bread-and-butter sector of the River Oaks market – acceptably updated houses in decent locations priced between $2 and $4 million – has been especially quiet, sensitive as it is to both interest rates and the news cycle.
The few houses in that category that have transacted this year have typically involved incoming relocation buyers in a hurry matched by sellers unloading rental properties, which makes a lot of sense given the interest rate impasse.
Flavor of the season
If there has been any trend so far in 2024 it has been an appetite for special locations by the well-to-do. With a few exceptions, most sales have involved very pricey large lots in primo spots, or classic but dowdy houses on a decent lot on a special block. Cash or special financing have been the means of payment.
To be clear, these buyers do not fall into the category of two-career households or first-time homebuyers. Neither general economic conditions nor interest rates have much relevance to their purchasing decisions. Their wealth is either derived from windfall income or family legacy, and their influence on the market has been notable of late.
Not being subject to the sordid pulls and shoves of typical market forces, also known as supply and demand, these buyers can ratchet up pricing expectations to unintentionally skew the market in the near term. So, it is encouraging to note that savvy sellers, who might otherwise have put off their decision for another year or two, have been getting on the market.
We encourage readers who are prospective sellers in the near to medium term to get in touch to talk about possible strategies and outcomes. Call us at 713-240-2611.
Correction: A big thank-you to an attentive reader of our River Oaks Market Report 2024 Outlook (available for purchase here.) The sale of 2221 Pelham in 2023 was incorrectly stated as being 2211 Pelham. Sorry.
