Ted C. Jones is a real estate economist, based in Houston. He says it’s important to keep in mind that different home price surveys use different methodologies. For example, the Case-Shiller index compares the sale prices of homes to what they went for the last time those particular homes sold.
“In the Houston index, what we’re looking at is if I buy a home today, that price goes into the index. We don’t compare to the previous time that same home sold.”
Case-Shiller uses a three-month moving average. Jones says a more accurate measure is a twelve-month moving average, which cancels out seasonal variations in home sales.
“Average home price in Houston, and I’m going to use December data, was up one percent from a year ago. And if you use the medians, they were up a half-percent from a year ago.”
Jones says home prices in Houston and elsewhere in Texas have remained healthy because of job growth, a lack of overbuilding, and the state law that prohibits homeowners from borrowing against more than 80 percent of the value of their homes.