(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.”

For information contact:
David Jarvis @ 713.622.9909 x 132
email: djarvis@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

In spite of a slow recover from the national recession…Houston, Austin and San Antonio have already recouped all the jobs lost and Dallas-Fort Worth has regained nearly 70% of it’s lost jobs. This job growth has been spurred principally by the resurgent oil and gas industry. During the past week several articles have highlighted the continued expansion of domestic drilling in the nation and the projected continued growth in the oil and gas industry and more specifically the eagle ford shale. Texas’ heavy concentration of companies in the the oil and gas industry has allowed Texas to outperform the nation in terms of net new job formations. This is more evident in an analysis conducted by Economic Modeling Specialists, Inc. (EMSI), an Idaho based economics firm, which compares each states Total Job Growth to the Expected Job Growth. In the Article, “Which States are Growing More Competitive?” EMSI compares each state’s competitive advantage.

The following chart and table is taken from the article (click on the chart for the full version):

The competitive effect is calculated by the difference between the Total Jobs, 2011 and Expected Jobs, 2011.  This number indicates the overall competitiveness of the state’s economy versus the national economy. If the competitive effect is positive, the state is gaining a greater share of the total jobs being created than the national trends would have suggested. In terms of percentage, Texas ranked second with our 2011 jobs being 6% greater than expectations based on the national economy. However, the 880,586 competitive jobs is by far the largest competitive effect in the nation when compared to the next largest state. Texas’ competitive effect is more than 6 times greater than New York’s 142,843 competitive jobs and nearly 10 times greater than Louisiana’s 96,439 competitive jobs. It is important to note that Texas is not the only state benefiting from the oil and gas industry, as many of that states with a positive competitive advantage have strong and expanding energy industries.

As the economy improves in the near term, the states with higher competitive advantages will likely be the first out of the recession and will continue to attract jobs. This will have a positive impact on the housing market withing these states leading consumers to develop more confidence in these local economy’s as they continue to attract more people in search of jobs.

Mike Inselmann, President and Co-Founder of Metrostudy, will be speaking about trends in Houston’s New Home Market to the Realty Investment Club of Houston.

When: January 7, 2012

Where: Renaissance Houston Hotel

www.richclub.org

On January 4th, 2012, Metrostudy President and Co-Founder Mike Inselmann will deliver his 2012 Houston Housing Forecast entitled, “Keeping the Faith: the Argument for Increasing Home Sales in 2012.”  The speech, delivered over lunch, will seek to highlight the ever growing number of positive aspects of Houston’s economy and make the case that building activity will be forced to increase as a result of strong job gains and stout population growth.

Registration in Required.  To register, follow the link, paying close attention to the PayPal instructions for finalizing your reservation.

http://reg.abcsignup.com/reg/event_page.aspx?ek=0019-0007-B3BA2540D3F9478C8D5D91CCE23BC05D

Presenter: Mike Inselmann, Metrostudy President

When: Wednesday January 4th, 2012

Time: Check-In Begins at 11:00am with Lunch Served at Noon

Where: Intercontinental Hotel near the Galleria

For more information contact Candy Winter: 713-622-9909

Builders in a New Home Survey conducted monthly by Metrostudy show home sales have improved 13 percent over the last year.  The homebuilders surveyed in this report account for approximately 67 percent of the new single-family housing activity in the Houston market.  While new home sales are up, finished new home inventory is declining.  Finished new homes for sale have decline by 22 percent this year.  With a brisk pace of home sales and falling inventory, new home shoppers have less from which to choose.  Metrostudy credits the local economy’s job growth and robust population growth for the increase in new home sales.

(Houston, TX– November 1, 2011) Houston’s economy recovers further during 3Q11, driven by positive job growth, 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.

At the end of August 2011 the Texas Workforce Commission reported that the Houston job market added 65,600 jobs over the previous twelve months. As a result, Houston regained 80 percent of the jobs it shed during the recession that ended, locally, only 20 months ago. “Over the next 5 years Houston is expected to add roughly 150,000 new residents each year. Therefore, new development activity in 2011 and going forward will be driven by real demand created by strong job growth and a truly recovering local economy,” said David Jarvis, director of Metrostudy’s Houston division.

During 3Q11, 4,947 new homes were started, 20% more than in 3Q10. 5,363 new homes were closed during 3Q11, only 1% down from 3Q10.

The 4,251 finished vacant homes counted during the 3Q11 survey represent a 2.8 month supply. This is down 30% over the past two years. Units currently under construction represent the largest share of new home inventory. The 5,207 homes currently under construction are the most since the expiration of the federal tax credit programs in
2010. “In 3Q11, there are more homes under construction than there are finished and vacant, which points to a stabilizing of new home inventory,” said Jarvis.

“Both builders and lenders have cut down on speculative building programs in the face of a tightened lending environment. The strong growth in sales, year over year, experienced during the summer months is the driver behind the increase in homes under construction,” said Jarvis.

For information contact:
david jarvis @ 713.622.9909 x 132
email djarvis@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

National woes persist but Houston’s economy and housing starts continue to improve and lead the nation. Join us at our 3Q-2011 Executive Briefing where we will discuss what is driving this improvement and how it will affect your customers and your business for the rest of the year.

WHEN: Thursday November 10, 2011 8:15am – 10:00am

INFO: email David Jarvis djarvis@metrostudy.com

Loren Steffy’s story in this mornings Houston Chronicle (http://www.chron.com/business/steffy/article/How-regulation-saved-Texas-economy-2141745.php) does a good job of describing how good mortgage laws in Texas helped Texas’ housing values hold up in the face of this country’s worst recession since the Great Depression. While many people in states like California, Florida, Nevada and Arizona were refinancing their homes to take out their equity (at the top of the housing market) after a 5 year run up of unsustainable appreciation (the housing bubble), Texans were capped @ 80 percent. The graphic below gives an example of home price appreciation for a hypothetical $200,000 house purchased in each state in the first quarter of 2001, according to the figures from the Federal Housing Finance Agency.

I appreciate the good mortgage laws in Texas and the “steady as you go” housing appreciation we enjoy as illustrated in the graph below. Outside of Texas, only California home values are showing signs of stabilizing.

Besides better mortgage laws, Texas has fewer regulations on new housing development which helped us avoid a shortage of homes that forced up home prices in those other states. The state’s ability to increase housing supply to meet demand is more important to maintaining a balanced supply of homes than the mortgage restrictions.

As expected, homes sales through the summer months of 2011 are outpacing those experienced during the same period last year in the wake of the expiration of the Federal Tax Credit. According to Metrostudy’s July 2011 Builder Survey, the twenty three builders surveyed, who represent roughly 67% of all new home activity in the Houston market, reported 1,265 net sales, a 40 percent increase from July-10. At the same time, the Houston Association of Realtors recorded 5,962 closings through its Multiple Listing Service in July-11, a 17.1 percent growth from the same period twelve month ago.

It is important to note that year-over-year comparisons through 2011 will be skewed due to the Tax Credit stimulus experienced in the early part of 2010. The tax credit did little to help the housing market recover, leaving a skewed selling season as its lingering effect. In any given year, whether boom time or recession, the natural home building cycle (pictured below) will start the year with steadily improving new home starts through the month of May. As the summer wears on and families take vacations, the cycle starts a gradual decline and then finishes the year at its slowest pace in the late fall and early winter months, a period that hosts numerous holidays which eat into a family’s availability to shop for homes. Because of the consistency of the cycle, home builders and land developers have built their business models around this expectation.

For the Houston market specifically, the tax credit hit just before the housing market achieved its true “bottom.” The hangover effects of the expiration of the tax credit then dropped Houston to its bottom in the last two quarters of 2010, when the market started fewer than 7,700 homes. When the market is that volatile, it muddies the outlook for “real” new home demand. This created the same kind of uncertainty in the home building industry that the new healthcare bill created for hospitals’ five-year outlook.

Metrostudy Houston Director David Jarvis will sit on a Business Forum to be held prior to the Mayor’s presentation at the Heights Chamber of Commerce’s Mayoral Luncheon. In addition to Mr. Jarvis’ insight into the dynamics of Houston’s housing market, other panelists will include experts from the Houston energy and healthcare fields.

When: Tuesday August 23, 2011 @ 10:00am

Tickets can be purchased through the Heights Chamber of Commerce. For more information contact info@heightschamber.com