Houston’s new home market delivered a mixed but encouraging signal in May, with builders reporting higher sales and slightly faster selling times even as inventory levels continued to climb.
According to the latest HomesUSA.com New Home Sales Report, new home sales in the Houston area increased to 2,169 in May from 1,958 in April. At the same time, Days on Market improved to 108.90 days from 110.70 days the previous month.
The gains suggest that buyer demand remains active despite mortgage rate pressures and growing inventory. However, several key indicators show the market has not yet returned to last year's pace.
Compared with May 2025, Houston new homes took longer to sell, with Days on Market rising from 96.26 days a year ago to 108.90 days this May. Pending sales also remained below year-ago levels, coming in at 1,939 compared with 2,350 in May 2025.
“May brought another encouraging increase in Houston new home sales, but the market is not where it was a year ago,” said Ben Caballero, CEO of HomesUSA.com and the nation’s top-ranked real estate agent. “Houston builders are seeing homes sell a little faster than they did in April, which is good news.”
“But higher inventory, stubborn mortgage rates and mixed year-over-year comparisons show this spring market still requires patience, pricing discipline and close attention to buyer demand,” Caballero added.
Caballero also noted that May sales could prove to be the strongest month of the year if mortgage rates remain at current levels or move higher.
Pricing showed modest movement in May. The average new home price declined to $398,646 from $403,001 in April. Despite the monthly decrease, prices remained slightly above May 2025 levels, when the average new home sold for $393,541.
Inventory continued to expand. Active listings increased to 15,671 in May from 15,652 in April and were significantly higher than the 14,271 active listings recorded one year earlier.
Pending sales remained essentially unchanged month over month, rising only slightly from 1,935 in April to 1,939 in May.
Houston builders also continued to hold pricing discipline. The average sales-to-list price ratio increased to 95.34% in May from 95.08% in April, indicating that new homes are still selling close to asking price.
The report is based on data from local Multiple Listing Services and uses three-month moving averages to smooth seasonal fluctuations and provide a clearer view of market trends.
While sales momentum improved in May, Houston's new home market continues to reflect a balancing act between buyer demand and growing inventory. The months ahead will reveal whether stronger sales activity can absorb the expanding supply of new homes entering the market.
HomesUSA.com is the No. 1-ranked brokerage for new-home sales in the U.S and creator of SpecDeck core builder systems technology is used by more than 70 builders in Texas.
