House Price Forecast

[zooter]

Hi,

I am looking to move to Houston within the next 2-2.5 years. I'm a Chemical Engineer and would probably be employed with one of the big consulting companies with offices in Sugarland. What I am worried about are the property values. Right now the prices are really affordable especially in the Sugarland and Katy area where you can get a really nice house for 250k. Where I live right now the same house would be close to $1 million!

I hope to sell my house here and then purchase a home on cash when I move. But I wasn't able to find any projected forecast on the Houston housing market. Do you think prices will rise substantially in the next 2-3 years? Also, before the depression in the housing market, what was the average price of a home in Sugarland? Any info would be really appreciated, thanks.

[TheNiche]

I'd be much less concerned with the change in value of a home here and more concerned with the home you're going to have to sell. Texas real estate is pretty solid, seeming to increase in value just a little above the rate of inflation each year. Seems like this'll be a low year for appreciation, probably not growing very much at all, but probably not declining either.

And our inventories of new unoccupied homes aren't insane, like in Phoenix or south Florida. At price points below $150k, there was a little too much to accomodate changing mortgage markets, so new construction has slowed down a lot while the inventories burned off. But above about $225k, the rate of new construction starts has actually continued to increase. The higher end of the market is rock solid.

[jm1fd]

The Chronicle had a big compilation of house price trends for various subdivisions in the area. I don't know if it included Sugarland or not.

I can almost guarantee that you're not going to see big appreciation in the next few years out in suburbia. This is primarily attributable to the fact that there's plenty of open space 5 minutes down the road from your house for builders to build more houses. Who wants your old used house when they can go down the road and get a brand new one? Inside the loop and certain other areas close in, where things are fully built out, this is not the case, and the potential for appreciation is very real.

You'd be better off spending your time researching the future of oil prices. If oil prices go down layoffs will start happening at the big energy firms around town, and the local economy will probably go south...it will certainly be less robust. That'll make for some problems if you're looking to sell during that time.

BTW, as Niche said, our market really isn't depressed. The high price of oil has kept our local economy hot, and thus demand for housing has remained strong in spite of the subprime collapse.

[zooter]

The Chronicle had a big compilation of house price trends for various subdivisions in the area. I don't know if it included Sugarland or not.

I can almost guarantee that you're not going to see big appreciation in the next few years out in suburbia. This is primarily attributable to the fact that there's plenty of open space 5 minutes down the road from your house for builders to build more houses. Who wants your old used house when they can go down the road and get a brand new one? Inside the loop and certain other areas close in, where things are fully built out, this is not the case, and the potential for appreciation is very real.

You'd be better off spending your time researching the future of oil prices. If oil prices go down layoffs will start happening at the big energy firms around town, and the local economy will probably go south...it will certainly be less robust. That'll make for some problems if you're looking to sell during that time.

BTW, as Niche said, our market really isn't depressed. The high price of oil has kept our local economy hot, and thus demand for housing has remained strong in spite of the subprime collapse.

thanks for the reply guys this brings things into perspective...i am actually in Calgary right now (kind of like Houston North) so oil prices are a big part of things over here as well...except we have seem unbelievable rise in house prices and now the market is a little bit more stable but no signs pointing towards things going way south.