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The latest numbers from the Houston Association of Realtors show just how bi-furcated today’s housing market has become. Sales of homes in the $80,000 to $150,000 price range dropped nearly 13% in August. The segment is suffering no doubt from the tightening of credit, particularly in subprime loans. Homes selling for more than $500,000, however, saw a 26% increase.
Total property sales for the month were 8,352, a 1.2% decline versus August of 2006. But by dollar value, sales grew 6% to $1.7 billion. Clearly the credit tightening hit the low-end of the market. The high-end, and this may have something to do with surging oil prices putting a little more money in Houstonians’ pockets, keeps on chugging. “We are pleased that the statistics show the Houston real estate market remains healthy, aside from the relatively narrow price range that has unfortunately suffered most as a result of the mortgage fallout,” said Rob Cook, chairman of the association said in a statement.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.