For months, Houstonians have been concerned that the recent slump in the price of oil would negatively impact home values in the area. Not so, says a new projection by Esri, a geographic information systems company. In fact, homes valued above $250,000 will increase by more than 40% by the year 2020.
Esri’s proprietary model takes into account supply and demand, construction data, socioeconomic trends, and national data to reach its estimates. The projected increase in home value is expected to come from a combination of existing homes appreciating in value and new construction selling for higher prices.
According to the Houston Business Journal, the Houston area will see an increase of 130,000 owner-occupied homes between now and 2020, an increase of roughly 10%. Almost all of the new owner-occupied homes will come from the $250,000+ price bracket.
While higher price range homes are going to become more numerous, lower-priced homes will become fewer and far between in the coming years. By 2020, Esri estimates there will be 126,000 fewer homes priced at $150,000 or below than there are now. This will be party due to homes currently in that price category increasing in value and partly due to older homes in poor condition being demolished in favor of new, higher-priced construction.
What does this mean for you as a buyer? Houston real estate is a solid investment and any money put toward a home now should see growth in the near-term future. Real estate in the city is getting more expensive all the time, and there is no end to market growth in sight, so there’s no time like the present to purchase your dream home.
For more information, please visit: http://www.bizjournals.com/houston/morning_call/2015/05/houstons-homes-to-projected-to-become-more.
Source: Houston Business Journal