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OPINION: Houston Housing Market Fundamentals In Perspective
We have been following real estate markets for signs of a cooling. And we see them everywhere. But we don't see the cooling signs for Houston's real estate market that we have seen in other parts of the country.
[We track and identify data and articles on a daily basis in our Articles of Interest section.]
Below, we will track our impressions of the Houston real estate market based only on sources we have noted for our readers' edification throughout the week.
In both Cleveland, OH and the state of Michigan we have noted market-cooling articles. These are not high-flying coastal markets, where a little topping off of the market might seem possible, if not necessary.
Using data from moving company United Van Lines, Michigan trailed only North Dakota last year in the ratio of emigrants to immigrants. Michigan lost 1.77 people for every 1 person it gained in terms of moving.
Cleveland also is seeing lackluster population growth according to RealEstateJournal.com.
Earlier in the week, we learned from The Chronicle that Houston has been a net winner in terms of immigration.
Demand from more people will provide support to the Houston market.
We believe the Houston housing market is fundamentally stronger than most other major metropolitan areas for several reasons:
1) As noted, people want to move to Houston. The immigration numbers prove it, both interstate and illegal.
2) The economy is strong. Unlike Michigan and Cleveland, Houston does not give off the impression of stagnation. Further, the auto industry shake-up hitting Michigan right now is something Houston has already experienced. The diversification since the oil and gas boom and bust of the 1980's has allowed for steady economic growth.
3) Cash Flow Investing opportunities are still available in Houston (our parent typically earns positive cash flows from its rental portfolio). As noted in this The Bakersfield Californian article, values will not be driven ever-higher by investors once prices negate investment cash-flows.
4) Pool of labor keeps not only demand high, but cost for construction and remodeling low.
We do not believe the Houston Real Estate Market is perfect. We do believe it is strong. And, from several former Ohioans in our organization, we can attest that we would much rather be here in Houston than in Cleveland.
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