What’s with the recent spike in Houston’s luxury market?
New construction, home appreciations and increased interest in high-end enclaves such as Spring Branch and Oak Forest East seem to be key parts of the answer. The two northwest Houston suburbs, separated by about five miles, have been on the receiving end of increased attention from developers, builders and home buyers.
Longer-established submarkets such as Memorial and River Oaks are better known for their luxe home listings, which remain popular. Meanwhile, Spring Branch and Oak Forest East are making upscale moves with newer builds.
According to data obtained from HAR, there has been a four-fold increase in sales of more than $1 million in Spring Branch, with a six-fold hike in Oak Forest.
While Spring Branch only saw two homes sell for over $1 million in August 2022, it jumped to 12 homes this year. Similarly, Oak Forest East logged a quartet of million-dollar transactions during the same time frame last year and followed up with 13 in August 2023. Both areas appear to benefit from offering more land compared with neighboring communities.
“We’re seeing a lot of new construction in Spring Branch and Oak Forest and a lot of it is they have good lot sizes that are allowing builders to come in and build larger houses for cheaper,” said Caroline Schlemmer, a luxury real estate agent who works in the areas. “Oak Forest is traditionally a bit more affordable than the Heights, and Spring Branch is a little more affordable than Memorial. So, we’ve just seen a big surge of development, and [Oak Forest and Spring Branch] are getting to be more and more desirable.”
Northwest Houston has seen a lot of increased development as the population center of the metropolitan area continues to shift in that direction. The luxury market has been seeing those gains as well. Oak Forest East, specifically, is heralded as one of Houston’s best communities for home appreciation. Median home prices in the area have increased by 47 percent over the past decade and upwards of 26 percent since 2018, according to HAR data compiled by Houston Properties.
“The appreciation in the air, even now, is really crazy,” said Ellen Krantz, co-head of real estate team Krantz Linn Group. “But also a lot of people have realized that if they want to get into a certain area, they may have to give up things that they weren’t willing to give up a year ago, and they’ve been waiting for the market inventory to get better, and maybe they’re more willing to take a house that needs updating versus looking for the perfect house.”
The submarkets’ abundant supply of newer homes allow for expansive customization options for buyers seeking curation. Particularly, the younger homebuyers who Krantz and Schlemmer say are some of the more prominent seekers in Houston’s surging luxury market. In any case, Coldwell Banker’s Global Luxury Report found that roughly 70 percent of luxury agents saw a growing preference for newer supply from their clients.
Spring Branch and Oak Forest East,, have long retained their suburban identity characterized by post-World War II residences, midcentury shopping plazas and 70s-style apartment complexes. They have experienced a resurgence in recent years as new generations of homeowners have taken the stage and made considerable inroads to revitalize and expand existing properties due to their preferential location near major highways, downtown Houston and the Energy Corridor.
Developers like Braun Enterprises have undertaken ambitious projects to redevelop parcels that were once occupied by aging apartment buildings and commercial centers. For instance, “Master Chef” season 3 winner Christine Ha recently brought two new eateries to these areas citing the submarket’s growing consumer base. The Spring Branch Management District offers a number of grants to help its revitalization efforts including a “Demolition Grant” for commercial property owners to bulldoze “unsightly” and aging projects in order to help fund redevelopment ambitions.
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