Real estate experts have a very positive outlook for the year ahead. While Seattle was selected the top-ranked real estate market, the Texas markets of Austin, Dallas/Fort Worth, and San Antonio were all listed in the top 20 in the Emerging Trends in Real Estate 2018 report compiled by the Urban Land Institute and PwC.
In growing real estate markets, property values increase. It's a double-edged sword: property is worth more so taxes can end up costing more.
Austin
Respondents to the annual report said the outlook for all property sectors in Austin is positive and the local economy has no shortage of investor interest or available capital. It was also noted that Austin's economy is significantly influenced by the presence of a major research university.
The Texas capital city was noted as having a vibrant start-up economy, with 11.5% of firms having been formed in the past 3-years. These start-ups account for 3.3% of total employment.
Austin's quality of life helps attract new residents. Population growth is projected at 2.8% in 2018, well above the U.S. average. Austin expects to add 42,000 residents a year over the next five years.
Dallas/Fort Worth
The Dallas/Fort Worth Metroplex received positive sentiment regarding the local economy, investor demand, capital availability, investment opportunity, and a business-friendly approach to the local development community.
Dallas/Fort Worth continues to benefit from recent corporate relocations, and is likely to remain attractive to companies considering relocation in the future.
DFW International Airport had the top airport connectivity ranking. In addition, 4.4% of regional employment is in foreign-owned enterprises.
San Antonio
San Antonio enjoys a lower cost of living compared with other regions and markets across the United States.
Affordable housing is a key component of the city's lower cost of living. Millennial residents are believed to be having a positive impact on the market.
A strong public commitment to infrastructure development is also mentioned as supporting local development.
Challenges Ahead
Texas real estate markets enjoy a number of strengths going into 2018, but the next few years will not be without challenges. Not surprisingly, a number of the challenges are related to assimilating recent growth, and positioning the market to handle the added growth expected in the near future.
Like most of the country, Texas markets expect high construction costs to be a challenge for 2018 with a shortage of qualified construction labor. Higher construction costs attributed to stricter regulations with issues surrounding the entitlement process for new development are also a growing concern.
Finally, escalating property taxes will be a major challenge for growing real estate markets in Texas and the rest of the nation. Owners must take advantage of all opportunities to reduce their tax assessment and minimize their tax expense.
Top Cities for 2018 |
|
1. |
Seattle |
2. |
Austin |
3. |
Salt Lake City |
4. |
Raleigh/Durham |
5. |
Dallas/Fort Worth |
6. |
Fort Laurderdale |
7. |
Los Angeles |
8. |
San Jose |
9. |
Nashville |
10. |
Boston |
11. |
Miami |
12. |
Charolotte |
13. |
Portland |
14. |
Charleston |
15. |
Northern Virgrinia |
16. |
Orlando |
17. |
Atlanta |
18. |
San Antonio |
19. |
Tampa St. Petersburg |
20. |
Oakland |
