In fact, homes in the Bayou City continue to appreciate six months after oil prices began plummeting from more than $100 a barrel to about $60 a barrel currently.
Houston home prices increased 7.7 percent year over year in May, according to Zillow Inc.’s (Nasdaq: Z) monthly housing report. The median home price in Houston is $158,000, according to Zillow’s home value index.
Local data from the Houston Association of Realtors also point to the strength of Houston home prices. Although home sales fell 4 percent year over year in May, the median home price jumped 10.5 percent year over year to $223,000, according to HAR’s multiple listing service information.
The jury is still out on whether the downturn in oil prices will dampen Houston home values.
Some residential analysts believe Houston’s diversified economy will help the city weather the oil downturn. A Houston Business Journal analysis of housing data from Esri, a geographic information systems company, found that Houston homes may actually become more expensive in the coming years.
Other industry experts aren’t so confident. Arch Mortgage Insurance Co., a Walnut Creek, California-based mortgage company, argued Houston is at greater risk for lower home values because the city is still too dependent on the oil and gas industry.
Zillow, the Seattle-based online real estate company, forecasts Houston’s housing market will grow a more modest 3.3 percent year over year by next May 2016.
While we wait and see how things will shake out, here are the top 25 neighborhoods where home values are increasing the most in Houston, according to Zillow.