Texas Real Estate Environment One of Nation's Strongest

COLLEGE STATION, Tex. – If you are going to write anything good about real estate, you will find yourself writing about Texas, says a noted economist with the Real Estate Center at Texas A&M University.

“Interest in Texas real estate has been magnified by the declining markets elsewhere across the nation,” said Dr. Mark Dotzour, the Center’s chief economist, citing the current Texas housing market as one of the strongest in the United States.

“Texas housing is still very affordable,” he said, “and the low tax structure and pro-business climate makes Texas a destination for corporate relocation for firms that are striving to compete in the global marketplace.”

Dotzour said population growth is another key factor contributing to the state’s healthy real estate climate.

“The latest figures show Texas is growing by about 400,000 each year,” he said. “All of these people need homes or apartments in which to live.”

Job growth is also strong, with Texas outperforming the national average and likely to continue doing so for the foreseeable future.

Texas still has home price appreciation, and the housing market specifics look good.

“Building permit activity has slowed in Austin, Dallas and San Antonio. Meanwhile, the inventory of unsold homes is still very modest,” Dotzour said, singling out Austin, where 3.2 months of inventory ranks the city as one of the tightest markets in the country.

If the otherwise robust Texas market faces any risk, Dotzour says it is from the mortgage market and increasing foreclosures, especially for houses priced at under $200,000.

“Relaxed lending standards have increased the number of homeowners dramatically,” Dotzour said. “Consequently, higher levels of foreclosures are to be expected.”

The Real Estate Center (recenter.tamu.edu) has been providing solutions through research for 35 years. Funded primarily by Texas real estate licensee fees, the Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers and the general public.

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