According to Forbes.com, More Americans are heading South — to Texas, in particular. The horizontal drilling and fracking boom has helped to double oil production in Texas in the last three years. Oil production in Texas has more than doubled in three years. In April 2011 we were doing about 1.35 million bpd. This April, according to the Energy Information Administration, we’re up to 2.9 million bpd — a level not seen since 1977.
Where?
Texas cities dominate a recent list by Forbes.com of areas seeing some of the biggest growth in new residents. More residents are also flocking to Florida. Here is the top list of 10 cities where Americans are heading,
Dallas-Fort Worth, Texas
Miami-Fort Lauderdale-Pompano Beach, Fla.
Austin, Texas
Tampa-St. Petersburg, Fla.
Houston
Washington, D.C.
Denver
San Antonio, Texas
Seattle, Washington
Riverside-San Bernardino, California
Click here to see the forbes list.
Why?
The boom is back. Like never before. The center of this growth is the Eagle Ford shale, which has exploded from nothing at all a decade ago to become one of the world’s biggest oil fields. The Permian Basin is quickly catching up. This year Texas oil output will all but certainly surpass 3 million barrels per day.
Already Texas has surpassed the oil output of OPEC bigs like Kuwait (2.8 million bpd) and Qatar (2 million bpd), and is closing in on Iraq (3 million bpd) and Iran (3.4 million bpd). There’s a chance that Texas could even catch China, which produces 4.5 million bpd.
This has been a beautiful thing for Texas’ economic health. The state has added about 300,000 jobs in the past year. Like back in 1981, there’s a real estate building boom going on in Houston, with apartment buildings and condos growing like weeds, and home prices in neighborhoods close to downtown soaring. Exxon Mobil even entered that fray, building a mega-complex for 10,000 workers half an hour north of Houston.
In conclusion, it is good to be Texan but at the same time not good to be home buyer since the prices have gone up multi-folds in the last 2 years and demand for the housing continue to push the pricing high every month. Home inventory is still low compared to last year as the homes don’t stay not longer in the market due to the high demand. We were wondering about this boom and hope it doesn’t burst in a bad way again.
Riverstone
A Fort Bend area master-planned community where luxurious homes, water features and resort-style amenities define the landscape, Riverstone is one of Fort Bend County’s most desirable addresses. Riverstone residents enjoy an enviable lifestyle with a superb selection of new homes with Sugar Land and Missouri City addresses. Plus, with varied highway access and an array […]
Sienna
Sienna is a comprehensive 7,000-acre master-planned community. Sienna is more than houses inside one of the top Fort Bend County subdivisions. Neatly tucked between the acclaimed cities of Missouri City and the City of Sugar Land, it is a community in the truest sense of the word. Every effort is made to maintain a sense […]
Bridgeland
Imagine a place with vast open spaces and spectacular sunsets. An 11,400 acre master-planned community in northwest Houston where flocks of waterfowl glide across natural lakes. A refuge from the chaos of your workday. A place where you can find true balance. The new home community of Bridgeland is such a place. Bridgeland attracts and […]
Towne Lake – Master Planned Community, Cypress
Towne Lake reflects its Texas-sized appeal in a 300-acre lake, with beautiful views. Lake coves allow neighbors easy access to the water and to the many amenities and destinations throughout, bonding the community together. Towne Lake Charm is all these things and more, reflected in a community steeped in Texas pride. Caldwell Companies has perfected […]
Cypress Creek Lakes
Cypress Creek Lakes is a beautiful master-planned new home community nestled in the charming Northwest Houston suburb of Cypress, Texas. Mischer Development has carefully designed the 1,600-acre community to respect the natural beauty of the land while developing approximately 2,000 new home sites. Its convenient location on Fry Rd. just off of Highway 290 also […]
Where Americans are moving in 2014?
Real Estate is strongest long term investment of all…
Few year ago homeowners were squandering to raise their equity and many of their properties where underwater until recently. It is now sellers market in many metro areas around nation and people starting to feel good about owning a home again. The cycle has turned to brighter side and no one knows how long it’s going to be this way. With this positive note, let me share the info about the topic. Americans have voted Real Estate again as the best investment for long term ahead of owning stocks bonds and gold.
Here is more about the story,
- Gold was the most popular long-term investment among Americans in 2011 — a time when gold was at its highest market price and real estate and stock values were lower than they are today. Gold prices dropped significantly after that and it lost favor with Americans. The 24% of Americans who currently name gold as the best long-term investment ties with the 24% who choose stocks.
- Bonds have been Americans’ least favored investment option for as long as Gallup has been asking the question. Savings accounts and CDs, on the other hand, have been more popular in the past. In September 2008, before gold was an option and at a time when the real estate and stock markets were tanking, savings accounts were the most popular long-term investment among Americans
- This year, the housing market has been improving across the U.S., and home prices have recently been rising after a steep drop in 2007 during the subprime mortgage crisis. This current improvement in prices may be why more Americans now consider real estate the best option for long-term investments. In 2002, during the real estate boom that preceded the mortgage crisis and before gold was offered as an option in the question, half of Americans said real estate was the best investment choice.
- Stock values have also been improving in recent years, aided particularly by the bull market in 2013. The 24% of Americans who regard stocks as the best long-term investment is also higher now, up from 19% in 2012. Still, Americans are modestly more likely to say real estate is the better investment today, perhaps because of the recent volatility in the stock market.
- Lower-income Americans, those living in households with less than $30,000 in annual income, are the most likely of all income groups to say gold is the best long-term investment choice, at 31%. Upper-income Americans are the least likely to name gold, at 18%.
- Americans between 18 and 29 years old are almost evenly split, with about one-quarter each saying real estate, stocks, gold, and savings accounts are the best choices for long-term investments. However, the 23% who said savings accounts is much higher than the percentage who gave this same answer in older age groups.
- With housing prices improving across the country, Americans are regaining faith that real estate is the best choice for long-term investments. But home ownership is also associated with views of real estate as an attractive investment opportunity. This leaves groups with lower home ownership rates, like lower-income and younger Americans, still looking elsewhere for investment options.
To read more on the survey, go to gallup.com
This is a real great news. I always guide people to diversify their portfolio. Don’t always keep your eggs in one basket. Try to spread around like some good shares, bonds, real estate and gold. That will help depending on which market you are in. When stocks are down, fixed assets always considered safe and rides the wave. When that cyclic moves, you see stocks and real estate doing good. It’s always good to have a good mixture and I really like real estate to be my hard asset holder. It all depends on everyone’s comfort-ability level and risk taking aspects. But you will never go zero on real estate investment which is not true in many investments.
Keep that in mind and invest wisely!!
Houston Named Top Relocation City – 5th year in a row…
You heard it right! Houston has been named the top U.S. destination city for movers, according to U-Haul’s newly released “2013 Top 50 U.S. Destination Cities Report.” The company’s rankings reflect destinations for movers renting a truck one way, and the list was compiled from more than 1.7 million one-way U-Haul truck transactions during a 12-month period.
The following cities emerged on U-Haul’s list as top destination cities:
Houston
Orlando, Fla.
Las Vegas
Chicago
San Antonio
Austin
Brooklyn, N.Y.
Philadelphia
Columbus, Ohio
Kansas City, Mo.
San Diego
Dallas
Sacramento, Calif.
Charlotte, N.C.
Phoenix
The ranking reflects destinations for movers renting a truck one way and considers every city in the country, regardless of size. However, the data is not stated as a percentage of population and is not reflective of overall growth.
To see full report, go to U-Haul
Must Know: Buyers – Which Mortgage is good choice 15 years or 30 years?
This may be a question to the Mortgage officer or lender who is trying to get your loan approved and processed. But I get this question a lot of times from my client. May be they just want to hear from me being such a financially knowledgeable and CFP candidate. And I don’t mind answer them to help and guide them on making a smart decision. After all, that’s what I claim myself as, Smart Houston Realtor.
There is no straight forward, constant answer for this question. It changes depending on the borrowers situation. So I cannot really give one answer for this question. Before I can answer them, I ask them few questions like,
- What is your financial situation? Do you have any other debts?
- Do you have good standard income to consider higher monthly payments?
- How long do you plan to stay at this home? After that, do you plan rent or sell?
- What is the Interest rate for 15 vs 30 years?
- Are you expecting any future expenses like kids birth, education etc.,?
The answers for these question will help analyze the borrower situation and find the solution accordingly.
For example, let’s say they say they are financially sound, no other obligations, expect to have standard income forever. I will ask to check the mortgage payments for both 15 vs 30 years using the calculator to see whether they have stomach for higher payments. If they do, I would recommend them go for 15 years loan payment and pay it off quick and get out of the mortgage. But if their income won’t be constant and expect future need, I strongly recommend them to go for 30 years mortgage and avoid locking them on to high payments. Also if you plan to stay longer, 30 years works well as well. 15 year mortgage basically helps to pay off quicker and less interest with higher payment and get off of loan faster. You will build more equity with the 15 year loan compared to 30 year loan in short period. We can argue both ways but it all depends each borrower situation basically.
Interest Rate
I would recommend them to try to get the GFE(Good Faith Estimate)/Estimate for both mortgage. Next, check out the amortization schedule for both rates and find out how much interest you will be paying extra for 30 year loan vs 15 year loan. If you are getting a big rate difference and good interest saving, go for 15 years compared to 30 years. It is always good to save on interest payment using less interest rate considering long term.
Tax Deduction
Another argument I hear from client is that you get more interest from 30 year loan which can be tax deductible. That’s not a smart way of looking at it. You are paying more interest and you are getting some tax deduction to get them back depending on your tax rate. Also you only get tax deduction when you file itemized deductions which many might not qualify. Let’s say you paying $100 interest and your tax rate is 20%, you are going to get only $20 back via your return. With 15 year loan, you might pay even less than $80 interest($100-$20 deduction depending on the interest rate which is better compared to 30 years even after tax deduction. They just think that higher interest can get higher deductions but they are not taking full picture into account.
Personal Preference
I personally like 30 years mortgage because it gives you the flexibility to have lower monthly payment, long term and no pressure on higher payments. Also you can pay additional amount every month and speed up the payoff period and even bring it down to 15 years depending on how much you are additional payment would be. With 15 years, you have to pay high payments and no choice whereas 30 Years loan your monthly payment can be remain low but you can still pay towards principal amount changing your balance as you pay additional amount, reducing it lower every month.
Investment
I also like to keep my homes as asset when I move out of the home. So I prefer 30 year loan which works well since I can pay off from rental income and build equity and don’t have to make extra payments if you have higher payments. Also you should be able to cover every thing including taxes, insurance with your rental and have some cash flow with less mortgage burden. Cash flow is always good.
In conclusion, it’s little bit tough decision to make but if you analyze properly and answer the above questions, you can easily figure out your answer. If you have big stomach for higher payment and want to build equity fast, go for 15 years. If you don’t care for equity and like to pay slow and have the flexibility to pay off more when you can then go for 30 years. That would be my answer and use my suggestion with your own discretion.
Texas making History: Hosts two of the five largest cities and more…
Yes, you heard it right. First time since the nation’s founding, two of the five largest cities (which are functionally defined as metropolitan areas) are in a single state (Texas). Dallas-Forth Worth and Houston are those two metro cities surpassing Philadelphia during last ten years to reach the top five position and they are even expected claim up to top two position in few decades by 2050.
A special report at newgeography.com talks about the 2013 annual metropolitan area population estimates by the US Census Bureau. It indicates a continuing and persistent dominance of population growth and domestic migration by the South. Between 2010 and 2013, 51 percent of the population increase in the 52 major metropolitan areas (over 1 million population) was in the South. The West accounted for 30 percent of the increase, followed by the Northeast at 11 percent and eight percent in the North Central (Midwest). Here are more snapshots of the story,
The dominance of the South was even greater when we turn to net domestic migration between Census Bureau regions. Nearly 785,000 more people moved to the major metropolitan areas of the South from other parts of the country than left. A much smaller 170,000 net domestic migrants moved to major metropolitan areas in the West. At the same time the Northeast lost 485,000 net domestic migrants and the Midwest lost 280,000.
Perhaps even more remarkable, the South, long a laggard as an immigrant destination, even led in net international migration (666,000 for a 1.2 percent over three years), though the Northeast added 546,000, for a 1.0 percent rate). Net international migration to the West was about the same, some 454,000 for a 1.0 percent rate. The Midwest had the lowest net international migration in the country and well below any other region (280,000, for a 0.6 percent rate)
The New York metropolitan area continues to hold the top position, having added nearly 400,000 residents since 2010 to rise to a population of 19,950,000 residents. At its current rate of growth, New York will exceed a population of 20 million in 2014.Los Angeles and Chicago continued to retain the second and third positions, which they seem likely to maintain for decades. Population projections by the National Conference of Mayors indicates strong growth in Dallas-Fort Worth and Houston over the next three decades could have them by pass Chicago by 2050.
Late in the last decade, Dallas-Fort Worth passed Philadelphia to become the fourth largest metropolitan area. Then, Philadelphia was passed by Houston in 2011. The result is that, for the first time since the nation’s founding, two of the five largest cities (which are functionally defined as metropolitan areas) are in a single state (Texas).
Among the 52 major metropolitan areas, Austin has grown at the greatest percentage rate since 2010 with Raleigh was the second fastest growing. Houston was the third fastest growing major metropolitan area over the three year period. Orlando ranked 4th in growth from 2010, while San Antonio was the fifth. The top ten was rounded out by Denver, Washington, Dallas-Fort Worth, Charlotte and Oklahoma City. Thus, among the 10 fastest-growing major metropolitan areas, nine were in the South and one (Denver) was in the West.
Net domestic migration is, not surprisingly, dominated by the major metropolitan areas of the South, especially Texas and Florida. Dallas-Fort Worth and Houston led the nation with more than 100,000 net domestic migrants (Figure $$$). Austin placed third in San Antonio was sixth. Charlotte ranked seventh, while the Florida entries Orlando stood at eighth and Tampa-St. Petersburg at 10th. The West had three big domestic migration lures, Phoenix (4th), Denver (5th), and Seattle (9th).
There are too many driving forces for Texas to bring human force to have the state carry the top 2 metros out of five. Immigrants from neighboring mexico reducing cost of labor, international immigrants and domestic migration due to job growth in various fields(like Medical, Financial and more prominently oil and gas industry),low cost housing, longer summer period, low cost of living all seems to be very attractive to pass on…
Keep it going Texas…
