The big picture
Houston Association of Realtors, or HAR, data from May shows only 20% of homeowners in town can afford the median single-family home in Friendswood. In Pearland, that number is 37%.
Jason Franklin, a licensed agent with Houston-based real estate agency, The Franklin Team, said housing prices don’t tend to drop.
“If you’re waiting for prices to drop, you’ll be waiting a long time,” Franklin said.
Pearland Mayor Kevin Cole said he attributes the city’s high home prices to the desirability to live in the city. However, he acknowledged that it has led some, particularly younger families or people who grew up in the city, to struggle to stay within Pearland.
Meanwhile, developers in Manvel and Alvin are building thousands of new homes. Despite this, data from HAR shows housing prices in May were 16% higher in Manvel than Pearland.
Developments in Manvel, such as Valencia, are selling homes from $300,000-$600,000, while all new home communities in Pearland, including Massey Oaks and Alexander, range from $315,000-$360,000, according to Realtor.com.
However, incentives from builders can lead to lower interest rates on new homes and help homeowners save on monthly mortgage payments, according to Realtor.com.
Franklin said Manvel and Alvin may appeal more to first-time homebuyers. Cole added that Pearland and Friendswood appeal more to second-time buyers looking to “move up.”
What we know
For Alvin, Friendswood, Manvel and Pearland, average home values are at an all-time high, Zillow data shows. Of that group, Friendswood has seen the largest increase—up 43%—in the last five years.
Cole said he believes lot costs—which represent 20% of a home’s value—and development have driven up home prices.
In addition, Adam Hill, president of
Friendswood-based construction company Sterling Builders, said cities with high impact fees, such as Pearland, may have a harder time attracting developers to the area, as they lead to higher prices to build, which can also lead to higher home values.
Kurt Watkins, spokesperson for Hillwood Communities, which is developing Pomona and Valencia, said developing in more built-out areas comes with more regulations and requirements, which can lead to higher prices.
“Growing cities will typically lag price appreciation compared to built-out cities,” Watkins said.
What else?
According to a 2024 report from the National Association of Realtors, the median age of homebuyers is at an all-time high, while the percentage of homes bought by first-time buyers is at an all-time low—around 24%—and has declined by nearly 10 percentage points since 2014.
“First-time buyers today are in a tough spot,” Franklin said. “The last time we had a 7% interest rate, they were in junior high. They’re just not accustomed to these high [prices and rates].”
Looking ahead
In an attempt to help housing costs, Cole said Pearland officials are looking to prioritize denser development with smaller, more affordable home designs in upcoming city workshops and planning meetings.
“If I portion [infrastructure cost] over six lots, then my cost per lot is going to be cheaper,” Cole said. “Therefore, I can sell those lots to a builder. They’re just going to put smaller homes, smaller lots and bring pricing down to the individual homebuyer.”
Manvel Mayor Dan Davis said city officials hope to improve affordability through Manvel’s first-ever 20-year strategic plan, which was adopted in January. The plan, which was based on community input, will prioritize preserving rural areas in Manvel and concentrate on development on highways 6 and 288.
“We want to make sure that we’re strategic about it, that the growth comes in the right locations, so that way 30 years from now, it’s at a place where we can successfully maintain it,” he said.
Through these plans, Davis said he hopes improvements on roads, utilities and drainage will reduce development costs and in turn lower home prices.
“My family and I bought our ... first home in Manvel in 2017 because it was an attainable home for us,” Davis said. “We don’t want to price people out of the market of being able to realize in Manvel the same dream that my family and I were able to realize.”
