Sam Shueh
Many US cities still experience strong demand in housing which has driven up home prices. There are some cities that have experiencing the opposite.
These are cities that depend on a major industry for jobs. With the crude oil price erosion started last summer, a barrell of crude at $59.80 has dropped to $30.50. Some sources suggested there are 200,000 workers in the industry out of work. While many are overseas, many here in the US are already affected.
Bayou City(Houston's nickname) is one that is seening the opposite in terms of real estate.
Houston Real Estate market has seen disappointing home prices in both November and December 2015 compared to a year ago. HOUSTON REAL ESTATE MARKET Both November and December total sales and volume are off 2.4% and 9.9% respectively.
Oil dependent industry has a high probabilities to face housing price correction than more diversified cities. According to a risk assessment made by Arch Mortgage insurance in California that the following cities are likely to have higher risk Real Estate Risk than other US cities.
1. Dallas & San Antinio moderate risk
2. Houston moderate risk
3. West Palm Beach moderate risk
4. Austin moderate risk
5. Irving, CA low risk
It is not clear how long the crude will remain low. Many oil rich countries do not have that much cash to survive low crude oil price and can default like Greece. From what I read a couple of years this will stay low for sometime to come. The sharp price increase as tried in the past is long gone. Granted Houston has a more diversified industry base today than in the 1980s. To get retrenched oil workers to work in hospital industry is probably not an option.
Sam Shueh Realtor
I've called San Francisco South Bay home for over 37 years. We love this area and all it has to offer, and I enjoy sharing what I know about homes. I documented in several books about Silicon Valley history. I have much expertise in real estate...please give me a call. SamShuehRealtor at Gmail (Four-O-Eight) 425-1601
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