Home > Uncategorized > 2011 Houston Economic and Houston Forecast

2011 Houston Economic and Houston Forecast

There are many reasons to be optimistic about the improving economy in 2011.
The passing of the new Tax Bill, historically low interest rates and a lean and mean Corporate America all point to an improved 2011 economy.
Most forecasts project GDP growth around 2.8% nationally for the year.
This is an improvement over 2010, but still below normal for this stage of a recovery.
The job market will improve as well, but not enough to drive unemployment below 9% by the end of the year.

 

 The oil industry is still facing an uncertain regulatory future.
There are some that say it will be early 2012 before drilling resumes.
The delay is forcing major drillers and large oil companies to re-direct their drilling budgets to other regions of the world.
Several companies have kept crews employed, and still continue to pay non-working employees waiting on approval of new drilling permits.
They are unlikely to continue that strategy.
They will either lay off those employees or move those operations into international drilling programs, further exacerbating local oil industry employment.

 

 Nevertheless, after ending its streak of 16 straight months of declines in employment in May 2010, Texas job growth continue to accelerate in Texas through December, ending the year with a total job gain of 231,700.
The Houston MSA added 13,100 jobs in 2010, with 4,500 of those in the Mining and Logging sector.
Like the rest of the nation, Healthcare and Social Assistance led the way with 8,400 new jobs created in 2010.

 

Houston’s economy will continue to expand again in 2011, building on the momentum shown in 2010 and adding more even more jobs than the 13,100 gained in 2010.
By late 2011, the local economy will have regained many of the jobs that were shed during the Recession and Houston’s downturn.
As usual, growth will be driven by the national recovery, a global recovery, a weak U.S. dollar and an increased demand for energy and an upturn in drilling.

 

Houston homebuilders and home sellers have had a few positive’gusts of wind but no sustained’wind at our back’ to carry the market along consistently.
Job growth will be essential for strong housing demand on a regional basis.
Texas will continue to benefit from its strong, pro-business fundamentals and relatively stable housing market conditions.
For the most part, Houston has limited foreclosure overhang and a relatively small percentage of borrowers in a negative equity situation.

 

The existing home inventory in Houston currently sits above market equilibrium, but remains manageable.
The surge of activity created by the Federal Tax Credit caused a surge of resale listings.
Once demand died out after April, the market corrected itself and the supply of listings decreased in response to the hangover.
New home inventory rests right at the equilibrium point for the Houston market as much of the housing stock that was built during the run up in the housing market has been eliminated.
New lending standards will continue to be an issue for Houston builders, developers and homebuyers, but with the re-emergence of job expansion, low interest rates, population growth and a healthy balance of housing inventory, demand for new housing should be moderately better in 2011.

by Madison Inselmann

Metrostudy

for CCIM Gulf Coast Chapter  – 2011 Forecast Competition

Advertisements
Categories: Uncategorized
  1. No comments yet.
  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: