By Ralph Bivins
Houston home prices will increase over the next couple of years as the city’s economy adds new jobs while home inventory shrinks, Houston economist Ted C. Jones predicted at an economic forecast luncheon.
“We have the highest home prices in the history of Houston, Texas. The market is back,” Jones said.
Jones, speaking at the Spring Symposium of the University of Houston’s Institute for Regional Forecasting at the Hobby Center for Public Policy said rising apartment rents also will be driving consumers into home purchases.
“Rental rates are going up. As rents go up, people will say: ‘I’ve got to buy a home,’” Jones said.
Jones, chief economist for Stewart Title, told a packed ballroom audience at the Hyatt Regency hotel that home builders have “under-built” the market and suggested that home builders could be more aggressive in construction starts.
He predicts that the number of Houston area home sales will go up about 7.5 percent in 2012 and another 8 percent in 2013.
Commercial real estate developers have also been conservative in constructing new projects in recent years, Jones said. Meanwhile, the Houston economy has been expanding and the office and warehouse markets are exceptionally tight.
The energy business has expanding as domestic production increased in North America. “You will see a significant increase in manufacturing jobs at the Port of Houston in the next five years,” Jones said.