Will Housing in Houston Ever Boom???

Question

Rent and Mortgages in Houston are cheap and have been for a very long time. Houston isn't really considered a desirable area so I am just curious if housing will every be somewhat expensive there. It would surprise me because of the heat, crime, traffic, ect.

Answer 1

If by "BOOM" you mean see a ridiculous and unsustainable run up in prices like California did, then the answer is no.

It has nothing to do with heat and traffic. Florida and California and Arizona all have heat and traffic too. (Ever heard of L.A. traffic?)

Houston has one thing a lot of places that saw a huge run up in prices did not...lots and lots of land. San Francisco wasted all that good land on a huge bay, a beautiful harbor, fantastic looking hills....ok I'm being sarcastic, but you get the idea. All those things restrict where you can build. Houston is FLAT...flat, flat, flat. We don't have hills, or a bay, or mountains... we can keep building suburbs till we hit the Dallas city limit...or San Antonio, or Austin depending on which direction you want to build in.  Gas prices are starting to but a squeeze on this...it can cost a lot to commute from the Woodlands to Med Center each work day...but there really isn't any shortage of buildable land. That's why we have the traffic. You can literally get two or three times as much for your housing dollar in Houston as you can in California or Yankee-land, if you are willing to put up with traffic every day.

The other thing is that we DON'T have zoning.  Zoning is often used as a way of artificially driving up the price of land (and housing) by artificially restricting the supply. Housing regulations is a similar issue. Regulations take time to comply with, and time is money, so the more regulations you have the higher the house prices will be.

Lets say I own a nice lot in San Francisco. There is an old Victorian house there, I want to tear it down and slap up four of those really ugly modern townhomes. Well my chances of pulling that off in S.F. are pretty much near zip. Historic building regulations, zoning regulations, permits, etc. etc. etc. Even if I do pull it off, it those extra legal bills will all be passed on in the price of the townhomes. In Houston it would be a lot easier. This means we loose the pretty old Victorian house, (which is sad...I like pretty houses and hate townhomes) but we can now have four houses where we used to have just one. This not only makes the developer money, it increases the housing supply, thus helping to keep costs down.

In my neighborhood someone is doing just that. They bought an old 50s era tract home behind my place, filled in the pool, tore down the house, and are putting up two HUGE townhomes. There is ZERO yard...(which is not a bad thing in Houston, mowing in August ain't fun) but there are now two 3,000 foot + townhomes where one tract home used to be.

Put these two factors together and Houston will pretty much always have a plentiful suppy of housing. As long as housing is plentiful the market will set a fair and moderate price for it; which we consider to be a good thing because it means middle class people can afford houses without having to take out "super mega jumbo no doc stated income adjustable rate 100 year mortgages".  

Answer 2

UMMM.... construction for housing is always on the rise. You have more homes being built on a daily basis than anything else. There is always affordable housing and more so now with the housing crisis and foreclosures. Houston is a lot cheaper than some areas in the U.S and holds a lot more job opportunities. Thats why you have many people move to Tx, and the houston area on a monthly basis. Heat is always going to be here as it will be in any other U.S city. Crime and Traffic will always be an issue as well in Houston just like any other U.S city. You learn to adapt and work around each situation, if not then you dont move to that area and stay in the cave that your in.

Answer 3

its already boom. The number one city to buy a house and get a job is houston

Answer 4

Uh.  Yeah.  Tons of people come to Houston every year to live here because it is cheaper to live here than other places in the country.  I guess people being able to find jobs easier here and being able to afford their stuff isn't desirable for some people, but it sure seems it hasn't been an issue so far.  And you mention heat, crime, traffic.  What does that have to do with anything?  I am pretty sure there are other major cities in the U.S. that have exactly the same thing.  Sure, maybe not the heat as long, but they suffer through some seriously cold winters in contrast.  There are certainly worse places to live than Houston.  We must be doing something right if there are always people moving here and Houston is constantly growing.

Answer 5

What, and experience the massive busts that have affected the rest of the country? I hope not. It happened in the early 80s and I hope it doesn't ever happen again.

The problem with the so-called housing boom was that people were using their HOMES as an investment. Worse, they financed them with risky loans, AND expecting huge returns. Homebuilders threw up houses as fast as they could and then found that no one wanted to buy them. Yeah, that's just what I want to have happen here.

Slow and steady growth always wins the race.