employment growth

In Texas, it’s all about jobs, jobs, jobs.

A new report from the Real Estate Center at Texas A&M University says that the Texas economy gained 276,400 nonagricultural jobs from June 2014 to June 2015, an annual growth rate of 2.4 percent, compared with 2.1 percent for the United States. Many of the major metropolitan areas saw much bigger gains, like Midland-Odessa.

Midland ranked first in job creation, followed by Dallas-Plano-Irving, Odessa, Beaumont-Port Arthur, Austin-Round Rock, and San Antonio-New Braunfels. Fort Worth-Arlington ranked No. 7 with 2.7 percent job growth.

In fact, every single Texas metro areas except Wichita Falls had more jobs in June 2015 than one year prior.

Big sectors for job growth were:

  1. Leisure and Hospitality: 5.05 percent growth
  2. Education and health services: 3.87 percent growth
  3. Professional and business services: 3.54 percent growth
  4. Transportation, warehousing and utilities: 3.52 percent growth
  5. Construction: 3.34 percent growth

All these new jobs in the Texas economy were created despite lower oil prices. Real Estate Center research economist Ali Anari says there hasn’t been much impact from dropping oil prices yet. But that could change.

“The oil companies hedged into the future and they have oil contracts, many of them extending to the end of this year,” Anari said. “If there is a downtown, it would not be apparent until next year.”

(more…)

The Lone Star State isn’t the same place as it was during the big 1980s oil bust, and  is better weathering falling oil prices, but further price plunges and worker layoffs could negatively impact home sales and construction.

This is according to new research by Texas A&M Real Estate Center research economist James Gaines, who published Texas 2015 Housing Market and the Price of Oil last week. The six-page report explains that Texas’ economy has diversified significantly since the 80s bust, relying much more on healthcare, technology, and other sectors.

Here’s the takeaway:

The price of Texas oil and the upstream energy sector is a prime cause of concern for Texas’ 2015 economy and housing market. History shows that Texas’ housing does not depend on high oil prices. In fact, the state’s housing market has thrived at prices within a wide range of oil prices lower than those experienced in 2013 and the first half of 2014.

The saving grace for Texas right now is that the state didn’t go overboard in its response to rising oil prices in 2013 and 2014, a stark contrast to the 1980s, when there was huge overspending and overbuilding, Gaines writes.

(more…)

Homebuilder

With Western Texas Intermediate oil hovering around $45 a barrel, folks have been speculating about new home construction in Midland-Odessa and how layoffs and budget cuts might affect the spectacular boom of the past few years.

But while economists might raise a red flag, local homebuilders say pent-up demand and a more diversified economy are keeping the phones ringing and people signing on for new home construction.

“The demand is still the same as it has always been—everyone wants their home built yesterday,” said KC White, owner and president of KC White Homes, Inc. “More people outside of the oil world are calling my phone. There are more than just oilfield-related jobs here.”

Last year, 917 single-family building permits were issued to homebuilders for new residences in Midland, and 430 in Odessa, according to the U.S. Census Bureau and Real Estate Center at Texas A&M University. With the ink still wet on those contracts, builders don’t see a slowdown anytime soon. Many even have a waiting list.

Single family construction permits

Tight inventory is one of the biggest factors at play. With only 3.8 months of inventory in November 2014 (the most recent data available), the average home price in Midland was $301,500. Odessa had an even tighter market in that same month, with only 2.4 months inventory, and an average home price of $231,100. Jump to read more!

(more…)