May Newsletter

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May Residential Market Review: Courtesy of Please click on the logo to learn more.

HOUSTON HOME SALES REMAIN STRONG IN APRIL AS PRICES SOAR – Record pricing, rising interest rates and low inventory weigh on homebuyers

HOUSTON — (May 11, 2022) —

The Houston real estate market had a robust performance in April, however, for the first time in 2022, sales volume failed to best last year’s historic pace as record high prices, rising interest rates and limited inventory weighed on homebuyers during what is traditionally the busy spring homebuying season.
Single-family home sales were statistically flat, registering a fractional 0.2 percent decline with 9,079 units sold compared to 9,100 in April of 2021. On a year-to-date basis, however, the market has kept the momentum of what has so far been a strong year – running 7.4 percent ahead of 2021’s record-setting volume. Would-be homebuyers who have instead opted to rent drove single-family home leases up 17.2 percent, but pulled back a bit from townhome and condominium leases, which fell 3.0 percent.
Homes priced between $500,000 and $1 million experienced the largest increase in sales in April, registering a 45.0 percent year-over-year sales volume gain. That was followed by the luxury market – consisting of homes priced at $1 million and above – which shot up 24.9 percent. The $250,000 to $500,000 housing segment came in third place, climbing 13.5 percent. A continued lack of available homes priced below $250,000 has left consumers no choice but to shop for more expensive homes amid rising interest rates or to lease. Mortgage rates are surging at the fastest pace in 40 years, driven largely by the Federal Reserve’s more aggressive efforts to curb inflation. After reaching record prices in March, buyers pushed Houston home prices to even higher levels in April. The average price of a single-family home rose 14.9 percent to $426,061 while the median price jumped 16.6 percent to $343,990. Pricing for a single-family home in Houston surpassed $400,000 for the first time in March of this year. “Contrary to what some people think, we do actually have new listings hitting the market, but they are selling exceptionally quickly and at some of the highest prices of all time as buyers and investors make cash offers well above asking price to beat back their competition,” said HAR Chair Jennifer Wauhob with Better Homes and Gardens Real Estate Gary Greene. “Consumers have grown increasingly weary of the buying frenzy and many are considering postponing their purchasing plans because pricing and interest rates have exceeded their reach. Unfortunately, we don’t anticipate conditions to improve anytime soon.” The ‘Close to Original List Price Ratio’ for single-family homes reached 100.6 percent in April — the highest percentage ever. That means that a majority of buyers paid above list price for homes on the market. The ratio first broke the 100 percent mark last June, and did so again last July, as high-dollar buying began to permeate the market.

May Commercial Real Estate Highlights: Courtesy of BISNOW. Please click on the logo to learn more.

Historic Third Ward Music Venue To Return After $10M Renovation

Houston May 4, 2022 Lane Gillespie, Bisnow Houston 

Project Row Houses will renovate the historic Eldorado Ballroom, a Third Ward music venue that hosted legendary Black musicians for more than 30 years in the mid-20th century. Project Row Houses, a nonprofit community organization in the Third Ward, will spend $9.67M on the project, restoring the 10K SF building that has been damaged by two fires over the last decades. The organization is also adding a 5K SF annex.
When complete in 2023, the space will have a café and community market, a nonprofit art gallery and flex meeting space, according to Project Row Houses. The annex will provide space for more community gatherings, a green room, dressing rooms for weddings, an elevator and upgraded bathrooms. The original ballroom will host live music and events. Hines is leading the project, which will be designed by Stern and Bucek Architects and constructed by Forney Construction. The project is supported by local nonprofits the Kinder Foundation, Houston Endowment and the Brown Foundation, alongside the Project Row Houses’ board of directors and other supporters, the organization says.
“Our investment in the Third Ward and Project Row Houses remains long-term in focus and our support of Eldorado Ballroom recognizes its unique place in Third Ward and Houston history,” Kinder Foundation Chairman Rich Kinder said in a release. “We are proud to support the effort to restore this jewel of the community and bring the building back to life, restoring a cultural resource and social center that will continue to have a meaningful impact on the neighborhood and its residents.” The project is co-chaired by philanthropist Anita Smith, Hines Vice Chairman Hasty Johnson and Chris Williams. Eldorado Ballroom was founded by Anna Johnson Dupree and Clarence A. Dupree in 1939, and served as an acclaimed venue for Black musicians during segregation. The building, at 2310 Elgin St., hosted Louis Armstrong, James Brown, Little Richard, B.B. King, Ella Fitzgerald and more. The venue closed in the 1970s during a recession. It was given to Project Row Houses in 1999. Project Row Houses opened the venue briefly in 2003 for a fundraising event, raising $75K to help fund renovations it had been doing for four years. “The Eldorado Ballroom, from the moment its doors open, has always been the soul of the Third Ward,” Project Row Houses Executive Director Eureka Gilkey said. “As creative placekeepers with a deep commitment to our neighborhood, Project Row Houses is as proud to be preserving the history of this storied venue as we are to be preparing it to serve as a center for Black art, culture, and community long into the future. We can’t wait to celebrate with our friends, partners, and neighbors when the lights go down, the band hits the stage, and the ‘Rado is reborn.” Contact Lane Gillespie at

May Mortgage News & Education: Courtesy of Housing Wire. Please click on the logo to learn more.

Opinion: Is the lending market overcorrecting toward tech? Maybe

May 12, 2022, 4:25 pm By Michael Bernstein

I’m a technologist at heart, but that doesn’t mean the answer to every problem is a new tech deploymentRates are rising. Refinances are falling. Inventory is contracting. Application fallouts are worsening. It’s getting harder out there. Worsening market conditions are only going to accelerate an already hyper-competitive mortgage lending industry that is still learning to adapt to post-pandemic homebuying behaviors. Technology has been the focal point of that evolution more out of necessity than some consensus that homebuyers don’t want to interact with their lenders at all. Don’t get me wrong—I’m a technologist at heart, but that doesn’t mean the answer to every problem always has to be a new technology deployment—it can often be something as simple as a phone call and a timely response to a customer’s question. Customer-facing technologies, particularly loan origination and decisioning software, are now standard in mortgage lending’s tech stack. But it’s also possible for a homebuyer to apply and receive approval on a mortgage loan without them ever actually speaking with another human.
This is not an Amazon order – There are two critical problems with this. First, it’s not necessarily what the buyer even wants—we’re talking about one of the most important investments of a person’s life, not a spur-of-the-moment Amazon order. Second, for all the value lenders place on delivering simplicity through technology, convenience doesn’t always equal loyalty, and it certainly isn’t the only factor that separates a great customer experience from a poor one. It’s easy to assume what customers, especially younger ones, want in today’s always-on, digital-forever lifestyle—and easier still to adopt business practices that remove the human-to-human dynamic from a transaction. If customers want digital experiences, who are we to deny them, especially when we can potentially trim a few costs, automate our deal flow and scale more quickly in the process? Now, you’ll never hear me berate the role technology can and should play at critical moments in a homebuyer’s journey. Yes, a customer should be able to fill out a pre-qualification application digitally. Yes, a customer should be able to upload documents to a portal or receive a digital approval letter. They should be able to explore rate options and educate themselves on the intricacies of buying a home. We’re not cavepeople. But an overreliance on technology, as we’ve increasingly seen, has too many shortcomings to make a digital-exclusive homebuying experience sustainable.

What a borrower wants – The most obvious argument against a totally digital lending approach—and the one that requires the least amount of rationale—is that customers don’t want it. When you’re making the most important investment of your life, don’t you want the option to talk to somebody who knows what they’re doing? Of course you do. Market research backs that up. According to the 2021 J.D. Power U.S. Primary Mortgage Origination Satisfaction Study, only 3% of homebuyers relied exclusively on digital services to get a loan. John Cabell, financial services practice lead at J.D. Power, has the only quote I’ll need to wrap this up quickly:,“Technology alone is not a magic bullet in this market; the key is knowing where to leverage it and where to layer in more traditional forms of one-on-one support.” If customers don’t want it, don’t give it to them.

Giant monsters of our own making – There’s a scene in “Captain America: Civil War” in which Paul Rudd’s Ant-Man transforms into a 40-foot-tall giant. But he can only sustain it for a couple of minutes before he crashes out of the fight altogether and has to take a three-day nap to recover. Mortgage lending is facing the same disproportionate dilemma that technology, in many ways, can make worse. It also closely resembles the private equity mentality: Scale as fast as possible, focus on KPIs to secure more capital regardless of any underlying issues they might hide and, when costs need to be cut, start the layoffs. Technology can often be the catalyst for all three of these business tenets. It enables scale, makes KPIs like loan origination and volume look great on paper, and acts as a sort of proverbial safety net when costs need to be cut. Look a bit closer, though, and that mentality has more plot holes than a bad superhero movie (Ant-Man is great though). Scale for scalability’s sake doesn’t mean anything if a company has to contract at the first sign of market stress. Rate increases, declining inventory and fewer customers test lenders’ resilience and sustainability as well as their ability to cater to the customers they do have. In such scenarios, human-to-human touchpoints are often the only service that can make a homebuyer feel comfortable and confident enough to sign on the dotted line. That means enough loan officers on staff to engage proactively with clients, to educate them and to build the trust that can only be achieved between two humans. That means reducing response times from days to hours. That means reflecting the values that customers share: community, empathy, timeliness and service. There’s yet to be a piece of technology that can do those things better than people. And yet, an overdependence on technology often means fewer mortgage experts are on hand to delight customers and deliver a great homebuying experience. There’s no one to answer questions about DTI ratios, the down payment amount or closing costs at the moments they matter most. Customer satisfaction goes down. Customer acquisition costs go up. KPIs take a hit. Layoffs ensue and you’re back to where you started. We haven’t seen a market like the one we’re entering in more than a decade. Much has changed since then, most notably in how lenders service customers and loans. In the next year, we’re going to find out exactly who is more susceptible to market shifts and who has tempered the rush to technology adoption with a model that relies as much on a human touch as it does on technology-driven convenience. Just look for those taking a three-day nap.
Michael Bernstein is the co-founder and a branch manager of LendFriend Home Loans, an Austin-based mortgage lender. This column does not necessarily reflect the opinion of RealTrends’ editorial department and its owners. To contact the author of this story: Michael Bernstein at To contact the editor responsible for this story: Sarah Wheeler at

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