HOUSTON TX was named by Forbes magazine has named Houston among the nation s next boom towns.
Real Estates Hottest Market Is Still Houston. Here’s Why.
The city of Houston, like some others in the lone star state of Texas, has been seeing a sustained period of growth. This has been largely driven by the oil economy, and while there may be a few hiccups in the short term, it will continue to grow over a long period of time.
The employment statistics in the state are at an all time high and with 2015 promising a further 4% increase, these numbers look set to better themselves.
There are certain fundamental strengths present that make the Houston market a particularly attractive one from an investor’s point of view.
Houston is in the middle of a renaissance period for American oil. The country is close to fulfilling its long cherished goal of becoming energy independent as well as exporting excess oil to other countries. New techniques of harvesting shale oil found in large quantities in Texas have meant that large corporations are making a beeline for the state.
This has had a positive roll over effect on all related industries in the city, not just Housing. People are moving into the cities from all over the country and so the demand for rental accommodation, outright purchases of houses as well as other relocation services is at an all time high.
The government too must be given credit for some of the changes that have come about in the state recently. The money flowing into the state has been put to good use and civic services as well as other infrastructure concerns have been addressed.
It is said that it is difficult not to make money in a growth sector and that is exactly the situation that presents itself with respect to the Houston real estate market.
The large amount of land available in Houston has meant that the real estate market is still relatively affordable. A strong construction sector has kept pace with the demand up until now, however most experts are now estimating that prices will start to move upwards quickly.
According to separate reports from PricewaterhouseCoopers and the Urban Land institute, Houston Texas ranks as the number one real estate market in the entire United States for investment purposes and development expectations.
The housing market has been ranked as the second most attractive destination in the country with regard to return on investment. It is important to know that these rankings are arrived at after taking the opinions of respected developers, brokers, investment bankers, fund managers and others whose job it is to read the signs of commercial and residential real estate.
IN BUILT INSULATION AGAINST FALLING OIL PRICES
Oil prices have fallen to almost half of what they were in the last year. This has brought about a decreased return and a reduction in the targets that oil companies had set for themselves. This has led to a lot of hysteria surrounding the housing market and fears of an impending bust.
The truth of the matter? These concerns holds absolutely no water.
While the Houston real estate market has certainly been propped up by the Oil boom, it is by no means completely dependent on it. It has a vibrant economy independent of Oil. Also, while there will certainly be a slowdown, the infrastructure put in place is not going to disappear overnight.
If there is one thing that is as sure as anything, then that is that oil prices will come back up. When it does, then who will be the biggest beneficiary of this boom? The people who saw the big picture and stayed for the long run.
Here is a statistic for a little perspective: After taking the fall in oil prices into consideration, it has been estimated that Houston will add a further 65,000 jobs into its economy for the forthcoming year. That is still an impressive number by any yardstick.
The already tight inventory has provided an inbuilt resilience to housing prices which will continue to show impressive gains in all likelihood.
RELAXED LENDING STANDARDS
To ensure that the lower end of housing is not ignored, new rules have been chartered by the government according to which buyers can get a mortgage with only 3 percent down payment. This is something that the National Association of Realtors had been clamoring for to help boost volumes.
Now that the new regulations have been passed, an already strong real estate sector is set to grow stronger.