Multifamily Investment in Houston Texas

WHY TEXAS?

Forecast for the Texas Economy and multifamily investment in Houston Texas remains well positioned to continue to out perform the United States, with growth stemming from long time sources such as the energy sector as well as emerging industries. With both resurgence in established fields and discovery of new plays, the energy sector is likely to remain an important source of business activity.

multifamily investment in Houston Texas

Recent job gains have been concentrated in professional and business services; trade, transportation, and utilities; and construction. The mineral sector is also quite strong in some regions. This broad based expansion sets the stage for ongoing performance at a rate outpacing the nation as a whole. The Texas housing market continues to improve; single family sales and new construction permits are trending steadily upward.

Construction employment is contributing to overall growth, and with housing inventories dropping, further gains are likely. The Perryman Group’s most recent forecast for Texas calls for output (real gross product) growth over the 2012 – 2017 period at a 4.66% rate, while employment expands by 2.28% (again of more than1.35 million net new jobs).

Key sectors in terms of output gains will be services, mining and trade.

WHY HOUSTON

  • Houston is a national leader in employment and population growth
  • #1 in projected population growth from 2012-2017
  • #2 in projected employment growth from 2012-2017

Employment Growth

  • #1 job growth rate of top 20 major metros with 3.6% growth for Jun’13 Y-O-Y (87,500 jobs from Oct’12 to Oct’13)
  • Economists project approximately 80,000 to 90,000 jobs to be gained in 2014 for Houston

Population Growth

  • Largest % population gain of any major U.S. Metropolitan with 26.1% from 2000-2010
  • In addition to the strong population growth seen over the past ten years, Houston is expected to add 490,228 individuals
  • #4 of US MSA’s) in the next five years

Rent & Occupancy Growth

  • Three consecutive years of solid occupancy growth; first time to reach above 90% since 2005
  • Rental rates grew 6.6% for all classes of Houston multifamily during 2013

multifamily investment in Houston Market Updates

 

multifamily investment in houston texas housing chart

Historic Absorption & Supply Numbers

  • 2010 and 2011 delivered the lowest number of units in 15+ years; only 5,636 conventional units delivered during 2012 Last three years have absorbed over 15,000 units each year; 16,550 units absorbed during 2012

Areas of Job Growth

  • Texas Medical Center
  • Upstream/Downstream energy industry
  • Port of Houston/Industrial market Infrastructure/Road construction projects
  • Banking/Finance