Energy Power
Expect home prices to jump significantly — soon: Economist sees a boom market inHouston
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When Ted C. Jones talks, people tend to listen.
Houston's home market will be on an impressive upswing over the next couple of years as the city’s energy industry surges and the local economy adds new jobs, Houston economist Ted C. Jones predicted at an economic forecast luncheon Tuesday.
The inventory of homes for sale has been dwindling and home builders have been constructing houses at a modest pace in Houston — and in the rest of the nation. Supply and demand will impact home prices.
“We have the highest home prices in the history of Houston, Texas. The market is back,” Jones said.
“In the last 12 months, the inventory of homes for sale has gone down 24 percent. We have eaten through the inventory,” Jones said. “In the next 18 to 24 months home prices will go up significantly.”
Jones, speaking at the Spring Symposium of the University of Houston’s Institute for Regional Forecasting at the Hobby Center for Public Policy, noted that home prices have recovered from the downturn that began in 2008.
“We have the highest home prices in the history of Houston, Texas. The market is back,” Jones said.
Jones, chief economist for Stewart Title, told a packed ballroom audience at the Hyatt Regency hotel that home builders have “under-built” the market and suggested that home builders could be more aggressive in construction starts.
Rising apartment rents also will be driving consumers into home purchases.
“Rental rates are going up. As rents go up, people will say: ‘I’ve got to buy a home,’ ” Jones said.
He predicts that the number of Houston area home sales will go up about 7.5 percent in 2012 and another 8 percent in 2013.
Commercial real estate developers have also been conservative in constructing new projects in recent years, Jones said. Meanwhile, the Houston economy has been expanding and the office and warehouse markets are exceptionally tight.
The energy business has expanding as domestic production increased in North America.
“You will see a significant increase in manufacturing jobs at the Port of Houston in the next five years,” Jones said.
