Real Estate Rumblings
Houston housing is underpriced; we're a "best buy" city, national survey asserts
Another day, another list pimping out Texasâ€™ real estate market. This time, Forbes declared five of its 20 â€śbest buy cities,â€ť i.e., where to invest in housing in 2015, are in Texas, including Houston at No. 3. In fact, all five Lone Star locales are in the top 10.
Austin leads the list with Dallas at No. 5, San Antonio at No. 6 and Fort Worth at No. 10.
The survey notes the drastic decline in the price of oil, but still believes that Houston and the other Texas cities "have more diversified economies than other oil boomtowns."
Forbes worked with Local Market Monitor, a data company that looks at home prices and economic factors in 300 housing markets across the nation, and determined that these cities are safe bets to invest â€” whether for rentals or first-time buyers â€” because of strong job and population growth, diversified economies, and relatively low housing prices.
Houstonâ€™s housing market is still underpriced by 7 percent, according to Local Market Monitorâ€™s â€śIncome Price,â€ť which tries to capture how the average home would be priced in a market without speculation or disruptions like the housing crash and how it relates to the average income over several years. An average home price in Houston is $214,049, according to the survey, and the areaâ€™s job growth is predicted to be 4.1 percent annually.
The survey notes the drastic decline in the price of oil, but still believes that Houston and the other Texas cities "have more diversified economies than other oil boomtowns," Local Market Monitor's president Ingo Winzer notes.
Austinâ€™s housing market is slightly overpriced at 8 percent. Still, the cityâ€™s booming population â€” which grew 8.9 percent from 2010 to 2013 â€” and annual job growth of 3.6 percent push it into the top spot.
Dallas is underpriced by 9 percent, with an average home price of $197,159, and a slightly lower job growth of 3.8 percent.
San Antonioâ€™s houses also are underpriced by 12 percent, with an average home price of $189,080. San Antonioâ€™s job growth is 2.5 percent. Of the Texas cities, Fort Worthâ€™s market is the most underpriced at 17 percent, with an average home price of $180,312, and annual job growth of 2.6 percent.
Texas had the most cities on the list; Florida had the second most, at four. However, only No. 4 Orlando made the top 10.
For the Texas cities, home prices have been growing between 7 and 12 percent, which indicates that even though flipping houses might be harder as the market continues to strengthen, the investment for long-term ownership is good in Texas.
Rounding out the top 10 are Provo, Utah (No. 2); Denver (No. 7); Boise, Idaho (No. 8); and Oklahoma City (No. 9).