BREAKING NEWS

RNR Real Estate Briefs – HOU, AUS, DAL & more

East River Adding Art to the Mix

Major Warehouse Lease Signed

Unilev Taps Stream Realty

58 Cities Drop Off Million-Dollar Home List

RNR Real Estate Briefs – HOU, AUS, DAL & more

REALTY NEWS REPORT - Logo

Banner
  • Home
  • Categories
    • Breaking News
    • Houston
    • Residential
    • New Development
    • People
    • Office
    • Multi-Family
    • Capital Markets
    • Texas
    • Retail
    • Hospitality
    • Industrial
    • Land
    • Lease Brief
    • Medical
    • National
    • Realty News Report
    • Trades
    • Uncategorized
  • Archive
  • Subscribe
  • The Ralph Bivins Project
  • About
  • Contact
FacebookLinkedinYoutubeEmail
REALTY NEWS REPORT - Logo

Comerica: Low Oil Prices Create an Economic ‘Sea Change’ and 11 Percent Drop in Housing Starts to Houston

by Realty News ReportDecember 17, 2014
Share0
Dr. Robert Dye
Dr. Robert Dye

HOUSTON – Significantly lower oil prices represent “a sea change” in the Houston economy and will bring about a weaker commercial real estate market and an 11 percent decline in housing starts in 2015, according to economic commentary by Comerica Bank.

After creating about 120,000 jobs in 2014, Comerica projects that Houston will add about 82,000 new jobs in 2015.

“However, significantly lower crude oil prices, now dropping through $60/barrel, represent a sea change for Houston. We expect oil drilling and exploration activity to cool worldwide. Also, service work on existing wells will ease, reflecting the decreasing profitability of crude oil production. Houston, as both a global and regional energy center will be caught in the changing currents. Already, we have seen the Texas drilling rig count dip for three consecutive weeks into early December. We expect to see this important leading indicator cool significantly over 2015, reflecting our view that oil prices will remain weak through 2015,” Comerica said in its Economic Insights reported issued Wednesday.

“We expect to see most of the Houston economy impacted by significantly lower oil prices. However, refiners, petrochemicals and other industries that use petroleum as an input will enjoy expanded profit margins and provide some counterbalance to reduced oil field activity,” the Comerica report said.

The weakness is expected to continue into 2016. The decline in housing starts will impact both single-family and multifamily markets in Houston, Comerica said.

“Houston’s previously robust rate of job growth will be a casualty of lower oil prices. We expect job growth in the Houston metro area to diminish in 2015 and again in 2016. Reduced job creation will attract fewer migrants into the Houston area in the years ahead. With consolidation in the energy sector will come less demand for office space, weighing on commercial real estate markets. Reduced job and income growth will likewise weigh on residential property markets,” Comerica said.

Dr. Robert A. Dye is Senior Vice President and Chief Economist at Comerica Bank, based in Dallas.

In a recent report, the Houston Association of Realtors and economist Dr. Ted C. Jones of Stewart Title forecasted a 10-12 percent drop in home sales in 2015 in Houston, which is having record-high sales in 2014.

Share0
previous post
Two Energy Firms Lease Office Space in Houston, Where Falling Oil Prices Pose Questions
next post
Trammell Crow/Prudential JV Start Spec Office Project Near Houston’s Energy Corridor

Related posts

RNR Real Estate Briefs – HOU, AUS, DAL & more

Realty News ReportMarch 25, 2023

East River Adding Art to the Mix

Realty News ReportMarch 23, 2023

Major Warehouse Lease Signed

Realty News ReportMarch 22, 2023

Leave a Comment Cancel Reply

Save my name, email, and website in this browser for the next time I comment.

Search News

Partners Ad
CBRE Ad
Arch Con Corporation Ad
Hines Ad
Avera Ad
Ziegler Cooper Ad
Lee & Associates Ad
2021 Realty News Report Ad
Property Logos
RNR - Lincoln Property Company
Hal Gordon - Property Tax Lawyer
Hunington Ad
Evergreen Commercial Realty
STREAM Ad
Hunington Ad

Let's Connect

logo
About US
Author Ralph Bivins is editor of Realty News Report, which covers regional and national news. Bivins recently received the Gold Award for Best Column in the National Association of Real Estate Editors Journalism Competition. Contact us
Follow us
FacebookLinkedinYoutubeEmail
@2022 All Right Reserved. Powered by CGS Digital Marketing
REALTY NEWS REPORT - Logo
FacebookLinkedinYoutubeEmail
  • Home
  • Categories
    • Breaking News
    • Houston
    • Residential
    • New Development
    • People
    • Office
    • Multi-Family
    • Capital Markets
    • Texas
    • Retail
    • Hospitality
    • Industrial
    • Land
    • Lease Brief
    • Medical
    • National
    • Realty News Report
    • Trades
    • Uncategorized
  • Archive
  • Subscribe
  • The Ralph Bivins Project
  • About
  • Contact