Houston — Houston is leading the nation in housing starts, as builders started 23,480 homes in 2012, according Metrostudy, a national housing data firm.
For Houston, the recovery is surging roughly nine months ahead of the national average. Job growth remains strong, creating a robust housing demand over the last twelve months.
In November, the Greater Houston job market regained the top spot in the nation in terms of annual job growth, adding 85,300 jobs over the previous twelve months. “The current pace is slightly ahead of what the Greater Houston Partnership projected, thanks to a late year surge in construction hiring,” said David Jarvis, director of Metrostudy’s Houston division. As a result of the strong job growth in 2012 Houston’s unemployment rate has dropped from 7.3% to 5.8% through November 2012.
On an annual basis, Houston builders started 23,480 new homes in 2012, a 27% increase from 2011 and the highest year end tally since before the recession. In 4Q12, area builders closed 5,720 new homes, bringing the year-end total for 2012 to 21,713. 2012’s closing tally represents a 17% increase in closings activity when compared to 2011. “Given the time required to complete a home, closings tend to trail starts in a growing market. Therefore, new home closings should trend above 23,000, on an annual basis, in 2013,” said Jarvis.
The relative supply of finished vacant homes in the market currently rests at 1.9 months, a seven year low. In fact, the market currently has twice as many homes under construction as it does home sitting finished and vacant. “The sizable difference between these two categories of inventory confirms the ability of builders to tighten their inventory over the last eight quarters and highlights the vigorous new home demand present in Houston,” said Jarvis.