Houston looking solid, not bubbly
With so many stories about Houstonians selling their homes within days and properties going for well above their asking prices, it would be natural to wonder if Houston might be in a housing bubble — or at least headed toward one.
Not to worry, said one national real estate economist. While the local market is, in fact, slightly overvalued, it’s not in a bubble.
“I would rather describe it as ‘not undervalued,’ ” said Jed Kolko, chief economist of San Francisco-based Trulia, a real estate search firm that released a report last week on housing bubbles.
Houston-area home prices, the report said, are overvalued by 2 percent.
“Two percent is very, very close to being right,” Kolko said.
Most of the country is still in recovery mode. On average, prices are undervalued 7 percent nationwide, the report said.
Houston is one of just a small number of markets the group deemed overvalued relative to incomes, rents and long-term home prices.
Still, Kolko said, the local market doesn’t appear to be headed for a bubble.
This area has long avoided huge real estate price swings.
Even during the U.S. housing boom in the 2000s, area housing was overvalued by just 8 percent, making Houston “one of the least overvalued markets at the time,” Kolko said.
“Now the local optimism, particularly around the energy industry, has kept prices in line with or slightly above market
fundamentals,” he said.
Houston’s price gains, however, should eventually moderate as more inventory comes onto the market.
“That inventory will come partly from the new construction and partly from homeowners who decide it’s time to sell and take advantage of the recent price gains,” Kolko said.
Randalls Food Markets, he said, is remodeling a number of stores and has plans to open new ones in Texas.
The landlord, Regency Centers, said it is “saddened at the loss of Randalls” and that it is working on ways to improve the Memorial-area center.
“At this time, we are not able to share specific details; however, we look forward to reinvesting in this community,” according to an emailed statement from Abe Pacetti, vice president of investments for Regency Centers in Houston. A Randalls will close
After decades on South Voss, Randalls will soon be closing its doors, leaving a large vacancy at the Woodway Collection shopping center on South Church sells land Voss. A Heights church
The Safeway-owned that dates to the early grocer said the closing is 1900s has sold a portion due to “an expired lease of its 20th Street property and an unsuccessful effort to a real estate investor to reach landlord agreeplanning to redevelop the ment on a new store.” The site. 1407 S. Voss location is Braun Enterprises, will be demolished to same attention.” from the sale toward a across from a new Trader which also owns the make room for shop and He said his firm recent$3 million renovation, Joe’s. former Harold’s in the restaurant space. ly passed on a national which will cover nearly
The Randalls opened Heights department “The area around 19th restaurant chain that all of the 65,000 square in 1979 and will close by store building nearby, and 20th streets has not expressed interest in the feet of worship, classroom the end of the month. purchased two buildchanged much in the last Harold’s space in favor of and office space in the Employees will be offered ings from Baptist Temple 20 years, but we love the a lease to Torchy’s Tacos, church’s T.C. Jester building.positionsatnearbystores, Church: a sanctuary built demographics and the aquirkyAustin-based president Paul McTavish in 1912 and a larger 1,300neighborhood,” president eatery that plans to build Plans call for a new said in an email, directing seat sanctuary built in the Dan Braun said in a statean outdoor patio and a 300-seat sanctuary, encustomers to a store two late 1940s. ment. “The strong interest small organic grocery trance and foyer, learning miles away at 5161 San Both buildings, on in our Harold’s space store there. and play areas for infants Felipe or the Westheimer the northwest corner of indicates that the church The church at 230 West and children and other at Gessner location. Rutland and 20th streets, property could draw the 20th will put the proceeds modifications that will bring the property up to Americans With Disabilities Act standards and city code.
The church was founded in 1908 with 19 people who met in a rented room above a grocery store on 19th Street. nancy.sarnoff@chron.com twitter.com/nsarnoff blog.chron.com/primeproperty