Technological advances have increased extraction capacity for oil and gas — not only in areas such as Midland-Odessa, Texas, where drilling began almost a century ago, but also in places where drilling was not previously financially feasible such as North Dakota, northern and western Pennsylvania, and south Texas.
During summer 2011 a group of Field Economists initiated a research effort to examine how technological improvements in gas and oil drilling have affected housing markets.
As exploration activity ramps up, this surge of high-income workers quickly fills all available motel rooms and vacant housing, creating a tremendous demand shock in these small markets. Resources become less available.
Oil and gas jobs draw in residents, and this heats up the housing market.
For example, The Houston area ranked among the top destinations for residents who relocated this summer, a reflection of the strong economy and local job growth.
Michael Stoll, an economist and chairman of the Department of Public Policy at UCLA, attributes Houston’s showing in the United Van Lines report to three key factors: Comparatively low housing costs, strength in the energy sector and global trade.
Houston’s status as a top destination market, as well as ranking 12th among the top 15 metro areas in the U.S. where people are leaving, has been great for business at Houston-based East End Transfer and Storage Inc., which represents United Van Lines.
Danny Frank, incoming chairman of the Houston Association of Realtors and an agent at Houston-based Turbo Realty, says that homes are taking less than 90 days to sell and often go for list price.
Exxon’s move to the Woodlands will definitely affect some other major changes for Houston and the Woodlands. Already, Big Oil’s big move is having an impact on The Woodlands. I talked to one Exxon employee recently who sold his home ideally situated in the “front” of The Woodlands near I-45 and moved to a neighborhood further back because property values had climbed nearly 40% from what he paid for the house just a few years ago.
For more information on how Oil and Gas affects the housing market, hear Paul Nunley speak on the topic on 1110 KTEK on Monday, March 11 with Brian Spitz between 7-8am. Or like us on Facebook and check back here next week for a link to the transcript if you miss the show.
Real estate investor and entrepreneur, Brian Spitz, has become one of Houston’s leading real estate investors. Brian’s company, Big State Home Buyers, has helped hundreds of sellers to avoid paying a commission to a realtor and clean up their property. He has also given assistance in situations where a home is inherited and not wanted. Brian provides professional service to anyone who may need to sell a home fast and is always willing to provide a free estimate. He also specializes in seamless real estate investing and is well known for his quality service to investors as well. Contact Brian at Big State Home Buyers for more information.
Listen to Brian every Monday on KTEK 1110 Business Radio between 7-8am with Kevin Price on the Price of Business.