‘Never Seen Anything Like It Before’: Galveston Realtors Spot Wild Shift in Island Housing Market

To numerous residents of Texas, possessing a dwelling on Galveston Island is an aspiration. Regardless of whether it serves as a retreat for weekends, a financial asset, or their main place of abode, a coastal home near the urban center holds significant allure.

Purchasers took advantage of the reduced interest rates.

during the pandemic, purchasing properties on the island. However, many now find themselves underwater. Galveston is what realtors are calling an “oversaturated market.” In other words, it’s a paradise for buyers.

“We’ve never seen this amount of inventory sitting for this amount of time,” said Realtor Shelby Forbert. “Homes are sitting six, seven, eight, nine months on the market.”

Forbert takes potential buyers on a tour of one of her Galveston listings, located on Jamaica Beach. This four-bedroom beach house has been on the market for six months. It has been completely flipped, and the brand-new furnishings are included in the sales price.

“I just brought this home down. It was listed at $650,000, and now it’s at $499,000. So, we’re just waiting it out,” Forbert said.

The present circumstances on the island, as reported by the Houston Association of Realtors, can be attributed to multiple reasons. Owners of properties are not experiencing the same level of income from vacation rentals as they did in 2020 and 2021, and upkeep costs continue to rise. Furthermore, property tax rates have almost doubled.

Another issue to consider is insurance. LendingTree reports that Galveston boasts the highest home insurance expenses in Texas, with averages approaching $12,000 annually. It should be noted that flood insurance is not included in this cost. Additionally, if the residence serves as an investment property, there will be heightened competition.

Forbert mentioned that Airbnb hosts are struggling since there has been an influx of properties available, with numerous homes suddenly entering the market for short-term rentals,” he explained. “Previously, such options were scarce, but nowadays, it seems like nearly every second house could be listed on Airbnb.

Forbert mentions that forecasting the development of the situation is challenging. She stated, “Ultimately, the market will determine the true worth of the property.” This implies that both eager sellers and keen buyers need to converge for a transaction to occur. Forbert explained further, “The only option is continually lowering the price till it attracts interest, which signifies its actual value.”