Houston’s Housing Market Diverges

Houston’s luxury residential prices are rising, while the overall market sinks.

In 2025, the sale price of homes in the city’s luxury enclaves increased year-over-year, while sale prices in the overall market decreased, according to Zillow and the Houston Association of Realtors. The diverging trendlines may be due to a constrained supply of luxury homes and a burgeoning supply of cheaper homes.

Last year, the average median sale price in Houston’s overall market was about $328,000, a slight drop from $330,000 in 2024, according to HAR. A difference of $2,000 means little to the average mortgagor, but it’s a meaningful shift after years of appreciation. The median sale price of a Houston home grew every year from 2021 to 2024, starting at $294,000 in the first full year of the pandemic.

Meanwhile, in the Memorial neighborhood’s 77024 ZIP code — the wealthiest in the city, according to Zillow — the average median sale price rose. In 2024, the average of all 12 monthly median sale prices exceeded $1.8 million, according to HAR. In 2025, it had grown past $2.1 million. The city’s first residential sale above $20 million took place in the ZIP code 77024 in 2022.

Sale prices rose as well in River Oaks, another preeminent luxury neighborhood. The average median sale price in 2024 was $1.1 million in the neighborhood’s 77019 ZIP code. In 2025, it was $1.2 million. Several of the top Houston sales of 2025 were clustered in River Oaks, including the most expensive deal, a 1.6-acre estate at 2110 River Oaks Boulevard that asked $18.9 million when it traded. The final sale price was not disclosed.

Houston’s overall housing inventory repeatedly reached new all-time heights last year, clocking the biggest housing inventory in the country in August, October and December, when the metro surpassed 42,000 active listings.