Thousands of Americans and many companies relocated to Texas during the pandemic, enticed by its low taxes and affordable cost of living.
Now, homebuilders are racing to keep up with the demand, prompting a surge in single-family building permits in the state’s most populous cities. A recent post from the National Association of Realtors’ (NAR) Economists’ Outlook blog identified Houston-The Woodlands-Sugar Land as the most active metropolitan area for single-family building permits.
The analysis of 262 US metropolitan areas included data from May 2020 to April 2021. Greater Houston issued 52,029 single-family building permits in that timeframe and added 120,900 new jobs — equating to two new jobs for every single-family permit that was granted. NAR Senior Economist and Director of Forecasting Nadia Evangelou says this ratio is indicative of a balanced market.
Compared to other US cities, Houston area home prices are exceedingly affordable, allowing buyers to score a brand new home for as little as $150,000, suggests BuzzBuzzHome data. Coupled with warm weather and a promising job market, Houston is an attractive place to live for many families.
Houston was followed by Dallas-Forth Worth-Arlington, which issued 47,853 single-family permits. Big D added 241,100 new jobs, more than any other metro surveyed. For every single-family permit issued, the Dallas region gained five new jobs.
Several prominent companies have moved to Dallas or opened offices there in the past year, particularly those in the real estate and finance sectors. CBRE, Charles Schwab, Wedgewood and Vanguard are among the businesses that have opened up shop in North Texas.
Coming in fifth place behind the Atlanta and Phoenix metros was Austin-Round Rock-Georgetown, which yielded 23,666 single-family permits. The local economy added 94,100 jobs during the 12-month period, which shakes out to four jobs for every single-family permit.
Austin is the hottest housing market in the country right now, and nearly three-fourths of homes sold above asking during the month of April, according to a newly published Redfin report. The median home sale price in the Texas capital also skyrocketed 42.3 percent annually in April to $465,000.
Austin has seen a large influx of tech workers from cities like San Francisco and New York who can afford to participate in heated bidding wars. So far, a whopping 1,500 Austin homes have fetched $100,000 over asking in 2021, compared to just 22 during the same period last year.
Nationwide, almost half of the metro areas tracked by NAR (46 percent) issued “more single-family building permits than the historical average.” The number of single-family homes that began construction dipped slightly in April but was still 24 percent higher than a year earlier.
“Housing construction is trending upward with housing starts likely to reach 1.6 million for all of 2021 and rise further to 1.7 million in 2022,” wrote Evangelou.