Why Houston’s Housing Market Hasn’t Crashed Yet; White Oak Bayou Greenway Bridge Now Open for Business


Photo of Dairy Land, now open at 310 Cavalcade St.: Brent Oldbury


19 Comment

  • Yay for more bayou bridges! Now TIRZ 5, get to work on the more important Heights Bike Trail to Stude Park connection. It’s so annoying that you can see the Heights bike trail from the park but you can’t get there.

  • I’ll tell you why the Pierce Elevated is congested 24/7. People drive like frightened grandmas on that stretch. Even when the overall traffic volume isn’t heavy enough to reduce it to stop-n-go, you will still get stuck behind some brainless yokel going 42mph in the passing lane with wide open road ahead of him. I guess they want to feel important like they’re the leader of a loooooooong procession. Don’t even get me started at how they slam on the brakes at the slightest hint of curvature in the road.

  • So upstream (midland) is being hammered, no surprise there. How long till Houston feels the crunch? Or has the market been efficient enough to see the coming drama and the slowdown we are seeing now has come far enough before the crash to stall it. There are a lot of speculators in this market, and hopefully they are savvy enough to pull themselves out of the demand so that they don’t drown on the far side of the cliff. If they do, if the market has been efficient enough, we may not see any real crash. Just a plateau.

  • I’ve been really impressed at the progress on connecting Heights and White Oak from Shepherd to 11th street… looks like they will be finished any day now.

  • Re: HCC land deals. Those do seem shady, and I have a very strong dislike of anybody that responds to questioning from an elected trustee with “Why do you ask so many questions?” However, the reporting isn’t great either. Tax records describe all land held by public entities as worthless because the market valuation is overridden by HCAD. That’s not an issue. And of course a warehouse in east Houston is far away from HCC’s central campus…but HCC has more than one campus, including multiple campuses in east Houston. If its that easy to poke holes in aspects of the reporting then that draws into question the seriousness of the accusations being made.

    Re: Housing market. Oh, just wait for it. The global economy is going nowhere fast, so basically the only way that the dollar can weaken is for the national economy to falter; and even then, things are so screwy overseas that that sort of event might feed back in a non-linear way such that the dollar doesn’t weaken as much as one might expect. Besides which, as I’ve said time and time again, this story about the local economy having diversified does not appear to be supported by compelling evidence.

    @ Purple City. That’s a simple and effective analysis. I had had the same thought as you that TXDoT’s plan looked bottleneck-y but hadn’t thought to simply count the lanes going in and through.

  • I think the price crash is coming (not a very big one, but enough) and is simply delayed, the momentum in the market is still there and should fizzle out by the end of the year. I for one welcome it and will be preparing to buy up distressed and/or undervalued properties to hold until the next boom which will follow in a couple of years.

  • I scream, you scream, we all scream for….. Dairy Land!

  • New brand of multi-million dollar spec homes? Smells like Urbant Living.

  • A & M couldn’t come up with contingency plan for the bats displaced? Come on! The “A” part is agricultural–Texas farmers used to build structures for bats to live in so that 1) they would have pest control and 2) the bat guano could be collected for fertilizer. This is stuff that schoolkids are taught from the push for education about bats and their ecology in Texas. The “M” part is mechanical — they couldn’t have had a project for engineering students to work on this and design possible alternative homes? A & M could have used this for some real world application of knowledge and skills they are supposed to be teaching their students, but instead frittered away the opportunity. . .
    I have a child there who would have volunteered to do this because he understands the value of bats as part of the environment as well as having a respect for living things (and he likes to build stuff).

  • I’m not a fan of slow pokes in left lane either, but on the Pierce your lane choice is more a factor of where you’re going than your speed.

  • “Several major home builders reported this week that their sales in Houston ran the gamut in the first quarter, from flat in comparison to a year ago, to up sharply, to down a bit. Commerce Department figures show that Houston’s residential construction slowed in the first quarter to a 2.2% year-over-year gain from an 8.6% gain in the previous year. Still, it’s not the outright decline that some were expecting.”

    This is just impossible !!! Not four months this blog was swamplotted with doom and gloom predictions from every self-appointed oil/gas industry, local economist,and real estate agent/developer/mortgage lender, that in addition to predicting the end of civilization as we know it, had us all scrambling to call our financial planners in hopes of staving off the financial Armageddon associated with falling oil prices ! Decimate the housing market in the City, it will !, was the common refrain.

  • Re: WSJ – It states that prices will grow by 8% less…which is still at least a 2% YOY increase. So what’s the big deal? It reminds me of all the talk of China’s economy tanking when it’s annual growth “slows” to 7%.

    Re: Purple City – That’s a damned fine analysis of the freeway situation around downtown. Would love to see something that simple come out of TXDOT one day, instead of 3D flyover videos of imaginary and unnecessary feats of engineering.

    Re: Aggie bats – When I was a student there two decades ago, the library’s 5th and 6th floors were infested with bats. They even had uniformed maintenance workers walking around with nets and cardboard boxes to catch them. I would think that in the 20 years since, they would have figured out some strategies for dealing with this issue.

  • @matx: Quote from article: “When the renovations began, some of Lacher’s students studied the issue and made recommendations to the school. They suggested following the example of the University of Florida, which had a similarly large bat population living inside its stadium. When that school forced its bats out its stadium, it built a group of large outdoor bat houses elsewhere on campus.”

    Sounds like a perfect opportunity for some students to organize and build new bat homes. Imagine all the Batman-themed fundraisers and t-shirts… Man, I would be all over this like guano on Kyle Field if I were there. ;)

  • if you look at the graph in the WSJ article, you can see why there will be no market crash, absent some huge economic upheaval. The housing activity was much more robust during prior to the 2008 crash than during the fracking boom. The housing activity during the fracking boom was just barely enough to keep up with demand. Slack in demand will just mean a return to a very normal and healthy housing market where sellers get a fair deal and buyers do not have to bid up prices. Also, the fact of the matter is that there is real value supporting a lot of the price increases. Innerloop neighborhoods offer short commute times, cleaned up neighborhoods, lots of improved amenities (retail, hike and bike trails, buffalo bayou, etc.). And the burbs are also seeing more value with quality K-12 schools and more opportunities to work/play without having to ever come into the city.

  • that article that was supposed to be about the HISD condemnation of houses was all over the map, was it an article about HISD condemning houses, gentrification, or what?
    I still don’t think that the number of houses has quite caught up with demand yet, same can be said for apartments. In 2008 the Houston MSA population was 5.7 million. Houston MSA population in 2014 was just under 6.5 million. That’s over 100,000 people per year from 2008 – 2014. I bet Houston MSA could have a net 0 population growth in 2015 and there’d still be a need to build more houses.

  • Ozone, thanks, I skimmed the article and missed it. I’ll check with my son to see if anything’s new.

  • From the WSJ article: “But another likely factor is a time lag. In short, real estate often is such a lagging indicator that it takes a year or more for economic shocks to fully register in home-sales volumes and prices.”
    Which means we have yet to see the effects of lower oil prices in the housing market. I’m guessing the present activity is from frustrated buyers who no longer have such tough competition for homes. I don’t think we’ll crash, especially inside the loop, but prices should definitely soften a fair amount if oil prices continue to lag.

  • If HCC were actually making money off real estate deals – and using that to offset operating costs – I wouldn’t begrudge them that. It’s standard operating procedure for institutions with endowments to make money from those endowments, and that’s essentially what those real estate investments are.
    But HCC does not actually appear to be making any money from their real estate invesments. If anything, they’re losing boatloads of money on it (witness the North MacGregor Way property fiasco.) On behalf of taxpayers, and the HCC community (my wife teaches there) I think we all need to ask: wtf?!

  • I don’t think many were expecting doom and gloom, but certainly a 10% correction or so to account for slackening demand. However, that doesn’t necessarily mean we’ll see it all around as it’s very possible for the suburbs to show greater losses than in-town where prices can be supported by higher income inequality. I think there’s signs of that already though. However, I know I was assuming a stock market correction was baked into the cake when stating such and that certainly hasn’t panned out with the market trading sideways this year. There’s a lot of stimulus being thrown around by the likes of China, Europe and Japan’s success in devaluing their currency so we’re not exactly in a period of stable demand levels yet to know where valuations should be.
    Still, you have to ask where do we go from here. A lot of homes sold in the first quarter were contracted out early last fall and many builders have been late on completions with the record activity going on. Companies are basically in a period of hiring and income freezes right now and that will continue indefinitely until companies lose more employees through the retirement process. We don’t necessarily have to see prices drop to see a correction as a couple years without price appreciation will look just the same.