Housing markets have remained relatively weak in many areas of the U.S., with two notable exceptions: Washington, D.C. and Texas. Overwhelming evidence suggests that while the federal government, one of the nation’s largest employers, is responsible for the ever-increasing housing demand in D.C.–the private marketplace is behind Texas’ boom. The Lone Star State’s pro-business environment, low taxes and reliable regulation have caused businesses to flock to the state. The result has been a bountiful job market, which draws individuals and families to Texas from around the world–many are eager to purchase homes upon arrival.
Fresh statistics released by the federal government show that America’s biggest cities are losing people to “second-tier” cities. Using the new data, Bloomberg Businessweek compiled a list of the top fastest-growing large metros. Not surprisingly, four Texas cities made the top ten: Austin (which ranked number one), San Antonio, Houston, and Dallas.
The growing population in Texas is undoubtedly having an effect on housing markets in the state’s largest cities. In Dallas, for example, more than one in 10 homes are sold in less than four days of going on the market, according to WFAA-TV.
“Texas is one of the only states that have prices that are higher than they were before the national recession,” Vance Ginn, an economist at the Texas Public Policy Foundation, told Breitbart Texas.
Ginn explained that smart public policy has been critical in attracting businesses and individuals alike to the state. The growing population has driven the high housing demand.
“The Texas model of low taxes, modest government spending, and stable regulations creates an environment where businesses have incentives to move to the state,” he said.
The unemployment rate in Texas is currently at 5.7 percent–a point lower than the national unemployment rate which has consistently hovered around 6.7 percent. Ginn added that while the national growth rate in the U.S. was 1.6 percent last year, Texas’ was 2.8 percent.
Many equate the state’s recent housing boom with the thriving oil and gas industry. But as Breitbart Texas previously reported, Texas has effectively diversified in terms of the industries it supports.
“The oil boom definitely helps Texas out,” Ginn said. “However, what we’ve really seen is a diversification of industries around the state.”
Texas was so energy-centered in the 1980’s that when the oil industry crashed later in the decade, it literally had a domino effect on the state’s entire economy. Ginn thinks this is not likely to happen again, since Texas is no longer reliant on the industry.
“After the oil bust of the 1980’s many cities like Midland became a ghost town,” Ginn said. “Their economy was based on oil. Texas learned from that. During the most recent recession, we saw oil fall to 35 dollars per barrel. If this had happened in the ’80’s, we would have seen a terrible slump in the economy. But given our current diverse economy, the decline we saw was very mild compared to other places in the country.”
Karr Ingham, a Texas-based gas and oil economist, said in a related interview with Breitbart Texas, “The oil and gas industry has not gotten smaller–rather, the overall Texas economy has gotten bigger. The state economy is now a powerhouse. It is more than just an oil and gas economy; it is an industrial economy, a tech economy, a business economy, a manufacturing economy… Texas has a lot going for it.”
“The economy as a whole is blossoming,” Ginn added. “There are more Fortune 500 companies moving to Texas than anywhere else in the nation…In fact, Texas is now the leader in high tech exports, an area usually thought to be trumped by Silicon Valley and California. Well, Texas became the leader in 2011. So right there shows that we are diversifying and expanding in many areas.”
Follow Kristin Tate on Twitter @KristinBTate
COMMENTS
Please let us know if you're having issues with commenting.