What Is Fueling The Current Texas Housing Surge
Over 500,000 new residents relocated to Texas as of December 2020, but what is driving first-time buyers and current homeowners to the hottest housing market.
It’s no secret that thousands of Americans have relocated from their native states and head to Texas to purchase real estate. The demand for housing in Texas is at an all-time high. Since May 2020, sales have increased by 58% in cities like Plano, Texas. The latest sale increase soared housing prices across Texas. Some of the hottest markets that Americans are migrating to are McAllen, Irving, Frisco, Dallas, and Austin. Dallas is witnessing historic highs for housing prices, as the cost of a single-family residence has increased by 33% since May 2020.
Why Are First-Time Homeowners Buying In Texas
As of July 1st, 2021, Texas housing sales increased for the third consecutive month. Now, the state suffers from an inventory shortage. Americans are fleeing to Texas for the high salaries the Lone Star State has to offer. On top of the opportunity for more earnings, everything is bigger in Texas for a reasonable price. Although housing prices have climbed over the last year, the cost of living remains below the US average.
As mentioned, In Texas, pay is more than reasonable for many positions such as managers, personal service managers, and recreational managers. They earn on average $120,000 a year. Architectural and engineering managers make on average $174,000 a year, and approximately 15,400 people are employed in a similar position.
What You Can Buy For $550,000
First-time buyers and current homeowners are often amazed what $500,000-$600,000 can get you in Texas. In San Antonio, $550,000 can get you a single-family residence of 4,185 sq ft with four bedrooms and three and a half baths. We compared what $645,000 could get you in San Diego. Since their market is as well suffering from a shortage, here’s what we found. In San Diego, $675,000 will get you a 1,901 sq ft home with four beds, two and a half baths. Your dollar is worth much more In San Antonio than in San Diego, nearly twice as much.
Although $550,000 can get you an ideal home in Texas, that is not necessarily the cost to live in the state. The price of $550,000 enters you into the market for a luxury home. However, in San Diego, the average home price is approximately $830,000. In May 2020, the average home price in Texas reached an all-time high at $292,100.
The Construction Forecast
It seems like everyone is relocating to Texas, including our business partners, The Buildsters, who recently moved to Austin. The pandemic influenced the way homeowners choose to live, resulting in a construction boom. Whether you had college students moving back in or were forced to transition to remote work, many realized their homes needed renovations. Others admitted they outgrew their space, especially if working remotely. Post-quarantine life demanded home renovations and larger homes.
Nearly a year and a half into the pandemic and construction boom, Dallas, Houston, and Austin are three of the four top cities for construction. Over 7,000 building permits were issued as of February in Dallas, the most submitted in any metro area that month. As Austin ranks third for top construction cities, this metro area suffers from a shortage of workers. There is a desperate need to build homes in Austin. According to Industrial Paint and Protection Magazine, “The striking lack of construction workers presents an opportunity for contractors and construction companies to take advantage of the high demand and low supply of laborers.”
The Texas real estate market is demanding and has driven many out-of-state homeowners and first-time buyers to relocate to various Texas cities for its below-average cost of living. Today, the construction industry in Texas is booming thanks to demand and the record-breaking building permits issued. Real estate agents remain overwhelmed as the market is more active than ever before.
If you’re interested in what the Texas real estate market has to offer, reach out to our friends at thebuildsters.com.