Houston housing market to churn through 2018

HOUSTON – Houston had more new-home starts in 2013 than the entire state of California, says housing consultant John Burns, head of Calif.-based John Burns Real Estate Consulting.

Burns’ survey of the best-selling master-planned communities in the nation shows that ten of the top 25 are in Houston.

He projects that annual new-home starts in Houston will increase about 13 percent annually over the next three years, peaking at 50,000 starts in 2016. “With only a three months supply of houses on the market, prices have to go up,” Burns says.

Houston builders could be building and selling 50,000 new homes in 2014, but a shortage of labor and quality lots is suppressing the local construction industry somewhat.

These projections indicate home prices will continue to increase, probably about 5 percent this year, followed by 4 percent next year. Prices will continue to rise through 2017, but will soften slightly in 2018.