HOUSTON (BISNOW) – September 24, 2019 – Houston ranked 42nd in the nation in a new survey of the markets with the best real estate prospects. But Houston is one of the few markets where real estate investors’ perception may not be reality. Houston fell from last year when it ranked 37th in The Emerging Trends in Real Estate report by PwC and Urban Land Institute.
Meanwhile, sister Texas cities Austin and Dallas ranked No. 1 and No. 6, respectively, in overall real estate prospects. The report suggests Houston’s overall real estate investment potential as judged by investors and developers is underwhelming and perhaps the result of misconceived notions about how the energy crash a few years ago impacted the city. “I am actually bullish on Houston,” PwC U.S. Real Estate practice leader Byron Carlock said.
Carlock said the notion that Houston lives and dies by its energy sector is highly inaccurate. Yet, this belief may have dampened real estate investors and developers’ perception of the market in recent years with an energy crash occurring not so long ago. “It’s a much more diverse economy than that, and it continues to grow in the healthcare sector and in prospective quality of life,” Carlock said. For starters, Houston is one of the most, if not, the diversely populated cities in America, edging out New Jersey and New York City for this distinction, the study said.
Carlock also points to the area’s food scene, culture and its focus on healthcare-related business development. The report said Houston’s economy is pushing the needle when it comes to life sciences and technology. And in 2019, the metro added roughly 80,000 jobs on a year-over-year basis. “Houston remains a powerful growth market, with its 10.7% population gain since 2010. This accounts for the multifamily sector’s leading role in 2018 and early 2019 investment — $10.8B, or about half of Houston’s recent acquisitions,” the report said. In addition, Houston’s office, retail and industrial sectors saw transactions exceed $3B apiece over the last 18 months, which is giving investors much more confidence in the area, the PwC and Urban Land Institute report concluded.