(Houston, TX– January 26, 2012) The confidence of the Houston market is beginning to build steam, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.
Houston’s unemployment rate dropped to 7.6%, a full percentage point less than the 3Q11 reading. Employment also grew by 3.3% annually. “Behind a surging Energy industry, a strong health care sector and recovering manufacturing and retail industries, six of Houston’s 16 employment sectors have added more than 10,000 jobs in the last 12 months,” said David Jarvis, director of Metrostudy’s Houston division.
Houston homebuilders started 18,417 new homes in 2011, a 2% decline from the 2010 total. But the 4,387 homes started in 4Q11 represent a 24% increase from last year’s tax credit-depressed quarterly starts count. 4,892 new homes were closed in 4Q11, 388 more than 4Q10.
At the end of 2011 the Houston new home market held in inventory fewer than 10,000 homes for the first time since 1997. A 10% decline in new home closings in 2011 resulted in the months of supply of new homes to rise to 6.4 months, above last year’s 5.9 months. “Regardless, builders should be forced to start more homes in 2012 in order to keep pace with the growing demand brought on by the health of the Houston economy,” said Jarvis.
“The building blocks for strong economic fundamentals continue to stack up in favor of the Houston market, but the headwinds of 2011 persist as 2012 begins. But based on the job growth of the last 12 months, the tight housing supply and the building confidence of the Houston market should lead to an increase in new home starts through the end of 2012.”
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