When Coronavirus struck the world, everything just seemed to get worse than expected. People are just stuck within the boundaries of their homes, waiting for the storm to pass. Will it still get better or is it just going to get even worse? Worry no more, as there is an oasis in the middle of the desert surrounded by the drought around us.
Since the global economic crisis started, and the oil prices collapsed, the real estate investing situation in Texas is surprisingly taking a different trend during these times. The activity for new home permitting in Houston is still performing at the same level it was in 2019. In fact, sales for master-planned communities in Houston and Austin particularly has significantly increased during the early half of 2020, compared to the same period last year.
The unexpected refuge with real estate industry in Texas
There is a notion when the Coronavirus hit the United States, it means that every business that is dependent upon going outside would struggle and the influx of people moving between cities and states would significantly decrease. However, the Texan market is proving that wrong.
Data shows that the sales from most of the master-planned communities in Texas have skyrocketed since 2020 begun, and has shown no signs of slowing down even during the pandemic. Tamarron, a community located in Houston, went up from 164 homes sold during the first half of 2019 to 327 during the same period in 2020. Balmoral community, which is developed by Land Tejas, is up 143%, sold 409 homes this year compared to the 168 homes sold in 2019.
It’s still the same case with Austin. Easton Park has doubled sales since early 2019. Sunfield, and Mariner Real Estate Development, are up 33% and 30% in the first half respectively. These are really strong increases, given that we are currently in a period of economic disturbance.
Dallas is also experiencing surges in new-home developments and continues to move faster. Hillwood Communities’ Union Park got a 64% increase in sales. and Johnson Development’s Viridian rose 37% in sales as well. Trinity Falls project shot up to 65% in sales during the first half, and Wood Creek sold 247 homes during the first half of 2020.
The trend started early
People are still moving in Texas even before the pandemic started. In fact, 85,000 people moved to Texas from other states in 2018, which resulted in a total population increase of 380,000. One of the reasons for this increase is the job opportunities present in Texas markets that pose great prospects for growth.
People are still moving in despite the situation, and they’re eager to buy properties amidst the pandemic. It is due to the fact that at the start of the year, there are a lot of jobs being concentrated in big markets, and most people are moving out of the congested cities in the metropolitan areas to seek suburban homes where there aren’t much population.
It is also due to the fact that the economies in Dallas, and Houston are booming since the start of the year. There is a 3.6% increase in job growth in Dallas, while there is a 2.6% increase in job growth in Houston, along with San Antonio. What these numbers mean is that the population that works within these cities are able to work with higher salaries, capable of paying rent to good-quality housing. When the population is able to earn more, they can pay more, so you can raise the rent and make the property even better, while still making the cash flow efficient and away from any big losses.
With these being said, it is important to have a wide connection with other real estate investors that can help you with making sure that your properties are in their top shape. Having teachers and mentors whom you can learn strategies from as you move up to the real estate industry, can contribute to your success in the business. Real Estate IQ can provide you with a community where you can learn other investing strategies and interact with other experienced investors.
Now, you may be wondering how long will this trend last? Let’s find out.
How long will the safe haven last?
Even though the Texan market stays strong, there is still uncertainty to what lies ahead. Job opportunities are starting to slow down due to not being able to cope during the quarantine period or not making enough sales, which results in the closing down of businesses and people getting unemployed. Fortunately, housing has not been held back even if COVID cases in Texas are still rising.
People are much eager to buy out properties from suburban communities so they can move out from crowded cities and get out of densely populated apartments. This presents an opportunity for real estate investors to capitalize on selling properties. Real Estate IQ can provide you with tools which you can use to check comps and gauge if the market is performing well where your target property is located. Having a set of data provided by analytics can back up your course of action and calculate the risks that you may be taking.
The situation we are in right now could really be challenging. The path that we are taking is more uncertain than what it used to be. The status of the real estate market in Texas is in good shape right now, but who knows what happens next. So it would be best if we act now, while still being careful. To overcome this economic drought, we should still press forward and take calculated risks as necessary. There is a constant temptation of just giving up around us, but we have to endure and equip ourselves with knowledge of what we can do and tools to help us along the way.
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Disclaimer: The blog articles are intended for educational and informational purposes only. Nothing in the content is intended as legal or financial advice.