The Houston property market enjoyed record years in 2014 and 2015, both for sales and prices. As far as 2016 goes, experts predict more of the same but at a lower level, a situation leading to a healthy market. In this article, BRIC Group summarises what to expect if you’re buying property in Houston this year.
Prices and sales for Houston property skyrocketed during 2014, a record year for the city. While 2015 was not quite as intense, prices still reached their highest levels ever and sales remained buoyant. This frenzied market where properties received multiple offers almost the instance they were listed is not expected to continue during this year. But both buyers and sellers of homes in Houston can expect a stable and healthy market over the next 12 months.
This, at least, is the opinion of Mario Arriaga, the new chairman of the Houston Association of Realtors (HAR), interviewed in the Houston Chronicle at the beginning of this year. In a two-part interview, Mr Arriaga lays down what he expects the Houston property market to do in 2016.
Stable and normal market
After 24 months of sharp hikes in house sales and prices, Mr Arriaga sees a much calmer year ahead. He still believes prices will rise, but not to the extent that they have over the last two years. He points out that Houston property does not usually rise by 8 to 10 per cent and goes on to add that “normally we are in the 2 to 4 or 5 per cent range of increase and I think that’s what we’ll see in 2016”.
One of the major factors behind this ‘normalised’ market will be the increase in inventory. The supply of property on the market in Houston currently stands at a very low 3.5 months (experts claim 6 months’ inventory shows a balanced market). Mr Arriaga does not predict a big increase in the number of homes on the market so Houston will remain very much a seller’s market, but he does expect a bigger choice and fewer bidding wars.
Impact of lower oil prices
The HAR Chairman believes the drop in oil prices will continue to impact the Houston economy, although he points out that the city has numerous alternatives for job creation and economic growth beyond the oil and gas fields. In particular, he cites the development of Houston port, the big growth in the petrochemical industry and the expansion of the medical sector.
He expects these three elements to be the main drivers behind the Houston economy in 2016 and by extension, the reason why thousands of new residents will move to the city. The fact that the new relocators need somewhere to live will “keep the market moving forward” whether they buy or rent a home.
“Houston rental properties have been particularly buoyant over the last two years,” says Dies Poppeliers, Managing Director of BRIC Group. “In November last year alone, demand for single family homes went up by 7.5 per cent and monthly rental prices by 1.9 per cent. At BRIC Group, we expect this trend to continue throughout 2016.”
Why buy Houston property
A wider choice on the market is just one of the reasons HAR lists for buying a property in Houston during 2016. The city also provides a wide range of options of housing areas from inner city to residential suburbs.
Houston offers world-class medical care along with plenty of amenities and leisure options. This together with the city’s cultural diversity makes it “a great city to live in”. And lastly, the new chairman of HAR highlights the affordability of Houston property.
BRIC Group, specialists in global property investment, offers real estate opportunities in the US and Brazil. These include turnkey property investments (many with tenants in place and a 2-year rental guarantee) in Houston and Florida in the US. They are also developing their own 5*, award-winning resort The Coral Brazil, a Lake and Beach resort in Northeast Brazil.
Source: Houston Chronicle