Victoria_Printz

Midland’s housing inventory continues to tighten amidst influx of buyers, including nearly 170 families currently relocating with Anadarko Petroleum Corporation.

The Midland Reporter-Telegram recently cited a 10-year record high for March with 231 homes sold at $66.458 million, compared to $40.934 million homes sold in the most active February going back five years.

This news is no surprise to Victoria Printz – top producing real estate agent serving Midland area residents since 1995.

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oil prices west texas

New numbers are in for the January real estate market in Midland, and the experts say the drop in oil prices are continuing to affect housing prices.

In Midland, the Local Market Monitor Report analysts predict a 1 percent decrease in home values over the next 12 months. Nationally, prices are forecast to increase by 4.4 percent.

In the last year, the price of West Texas Intermediate futures contracts has fallen almost 20 percent. Friday at the close of markets, it was $29.44 a barrel.

Many analysts say the worst isn’t over yet, and recently the CEO of ConocoPhillips Ryan Lance told investors the oil downturn could stretch into 2017.

“We believe this downturn could last a while longer,” Lance told the Houston Chronicle. “Just a few months ago, we thought the market would rebalance by the second half of 2016.”

But the Local Market Monitor reports predict an upturn in Midland before that: they’re forecasting a 3 percent increase in home values in the second year, and a 5 percent increase in the third.

They’re also saying home values for Odessa will increase by 4 percent over the next 12 months, and in the second and third years, prices will increase 7 percent and 8 percent, respectively.

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midland home values

The December housing numbers from Local Market Monitor Report are not painting a rosy picture of the real estate market in Midland, and home values are forecast to decrease over the next 12 months.

Since their peak in the first quarter of 2015, home prices in Midland have fallen by 3 percent. The average home price in this market is currently $179,091.

Over the past two years, the real estate market in Midland has gone from relentlessly enthusiastic, to more reserved, as the slump in the crude oil market drags on. On Monday, oil prices fell to their lowest level in 12 years, and futures of West Texas intermediate crude for February delivery came in at $31.41 a barrel, a 5.3 percent decrease.

“In June 2014, you had to shell out $110 to buy a barrel of Brent crude. By early 2015, that had plunged to $60,” writes Brad Plumer in his piece today for Vox Energy & Environment. “Today, it costs just $30 to buy a barrel of oil — a level not seen since 2004. It’s a staggering decline.”

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midland odessa real estate marketFourth quarter numbers from Local Market Monitor Report are in for the Midland and Odessa real estate markets and the enthusiasm is being dialed back for both markets.

Notably, they have lowered the investment score for Midland to 2.7, making is speculative. Odessa’s number is now 4.9, making it medium risk. Reports earlier this year had both markets much higher.

midland odessa real estate market

The reports note in both Midland and Odessa, economic growth has been good since the recession because of the development of shale oil deposits and the large energy sector currently dominates the economy. Overall, job growth was good in recent months, but in Midland, growth in the energy sector was poor. In Odessa, job growth was good in recent months, and growth in the energy sector was fair.

Total housing permits in October in Midland were down 16 percent from last year. Single family permits were down 16 percent. In Odessa, total housing permits in October were down 23
percent from last year. Single family permits were down 23 percent.

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Photo: Jeff Caldwell

Is the sun setting on Midland home price growth? Not according to Local Market Monitor’s forecast. (Photo: Jeff Caldwell)

Local Market Monitor‘s forecast for the Midland-Odessa areas show sustained optimism and growth for the next three years, with home prices growing 8 percent in both West Texas cities despite job losses in the area. The report, which covers statistics from Dec. 2014, states that both Midland and Odessa are considered “low risk” markets for investment, with prices expected to increase up to 10 percent year-over-year through 2018, increasing up to 30 percent in Midland and 26 percent in Odessa during that three-year period.

Jump for a more detailed analysis …

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