HOUSTON – (Realty News Report) – Major cities are leaking population to the suburbs, giving a lift to real estate in outlying areas.
Working-from-home is receiving a thorough trial-run during the pandemic. A few companies say they will go all-in and allow a majority of their staff to work-from-home all the time. Many other firms may allow employees to work at home for at least a day or two a week.
The result: the work-from-home trend makes suburbs more appealing.
“Corporate workplace trends, such as working-from-home, have energized the suburban housing markets. Even employees who will work-from-home only one or two days a week in the future, are more open to suburban and exurban living,” says Mark Sikes, principal with Deal Sikes, a Houston-based real estate valuation firm. “As this trend plays out, attitudes about long commutes will change and homebuyers will respond by moving farther out.”
Community developers and home building firms are showing an increased appetite for lots and developable land in counties surrounding Houston, says Sikes.
“We’ve been speculating about increasing interest in the suburbs and rural areas since the start of the pandemic,” said Redfin economist Taylor Marr. “Now we’re seeing concrete evidence that rural and suburban neighborhoods are more attractive to homebuyers than the city.
In July, the median home price in rural areas was up 11.3 percent over the corresponding period in the summer of 2019, according to a Redfin report. In suburban areas, the median price home was up 9.2 percent
New housing in the far flung suburbs are becoming more attractive as home prices are rising and inventory is tight. Houston Realtors just recorded their best month ever, selling over 11,000 homes in July.
Mortgage rates have been hovering around 3 percent, Sikes notes, and all indicators point to a lot of home building and future growth in the Houston area suburbs.
Home building is surging across the nation in the summer of 2020.
Support statistics keep rolling in: (1) Housing starts were up 22.6 percent in June, the U.S. Census Bureau reported. (2) The price of lumber has doubled since April. (3) In the stock market, shares of home building firms are rising. And (4) home builder confidence is the highest in 35 years, according to the National Association of Home Builders.
Houston analyst Lawrence Dean of Metrostudy said Houston area housing starts could hit 31,500 in 2020, one of the highest totals ever. That’s conditional on not having more unforeseen catastrophes – or another big downdraft in the oil and gad business.
So if you’re selling land, lumber, or houses in the outlying suburbs, 2020 may not be so bad after all.
Aug, 31, 2020 Realty News Report Copyright 2020
File: Pandemic prompts realty surge in suburbs
Photo credit: Ralph Bivins, Realty News Report