recenter.tamu · Texas Economic Outlook: 2019 Positive but Slower Growth Than 2018 9 U.S. Economy...
Transcript of recenter.tamu · Texas Economic Outlook: 2019 Positive but Slower Growth Than 2018 9 U.S. Economy...
Dr. James P. GainesChief Economist
recenter.tamu.edu
2018 A Very Good Year -2019 Definite Slowdown
2
• Real GDP growth 2018 2.9%+ 2019 ~2.5%
• Jobs expanded ~1.5% Unemployment rate ~4.0%+
• Interest rates up/down during the year;
• Inflation approached 2.5%
• Tax Cuts added positive impacts
• Industrial Production high but less labor
• Income and spending growing
• Real Disposable Personal Income +2.9% thru 3Q18
• Real PCE +2.6% thru 3Q18
• Housing improving, not fully recovered; recent stalling
• U.S. became #1 oil producer and net exporter
Source: The Conference Board (1985=100; NSA); Haver Analytics
Consumer Confidence Index
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
170
Jan
-07
Ju
l-07
Jan
-08
Ju
l-08
Jan
-09
Ju
l-09
Jan
-10
Ju
l-10
Jan
-11
Ju
l-11
Jan
-12
Ju
l-12
Jan
-13
Ju
l-13
Jan
-14
Ju
l-14
Jan
-15
Ju
l-15
Jan
-16
Ju
l-16
Jan
-17
Ju
l-17
Jan
-18
Ju
l-18
Jan
-19
Ju
l-19
3
U.S.
Texas
NFIB Small Business Optimism Index(Overall Index SA 1986 = 100)
84
86
88
90
92
94
96
98
100
102
104
106
108
110
112
114
Ja
n-1
1
Ma
r-11
Ma
y-1
1
Ju
l-1
1
Sep
-11
No
v-1
1
Ja
n-1
2
Ma
r-12
Ma
y-1
2
Ju
l-1
2
Sep
-12
No
v-1
2
Ja
n-1
3
Ma
r-13
Ma
y-1
3
Ju
l-1
3
Sep
-13
No
v-1
3
Ja
n-1
4
Ma
r-14
Ma
y-1
4
Ju
l-1
4
Sep
-14
No
v-1
4
Ja
n-1
5
Ma
r-15
Ma
y-1
5
Ju
l-1
5
Sep
-15
No
v-1
5
Ja
n-1
6
Ma
r-16
Ma
y-1
6
Ju
l-1
6
Sep
-16
No
v-1
6
Ja
n-1
7
Ma
r-17
Ma
y-1
7
Ju
l-1
7
Sep
-17
No
v-1
7
Ja
n-1
8
Ma
r-18
Ma
y-1
8
Ju
l-1
8
Sep
-18
No
v-1
8
Ja
n-1
9
Ma
r-19
Ma
y-1
9
Ju
l-1
9
Source: National Federation of Independent Businesses; based on ten survey indicators
Fed Funds Rate, 10-Year Treasury, 30-Year FMR
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
7.0
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
7.0
Jan
-07
Ap
r-07
Ju
l-07
Oct-
07
Jan
-08
Ap
r-08
Ju
l-08
Oct-
08
Jan
-09
Ap
r-09
Ju
l-09
Oct-
09
Jan
-10
Ap
r-10
Ju
l-10
Oct-
10
Jan
-11
Ap
r-11
Ju
l-11
Oct-
11
Jan
-12
Ap
r-12
Ju
l-12
Oct-
12
Jan
-13
Ap
r-13
Ju
l-13
Oct-
13
Jan
-14
Ap
r-14
Ju
l-14
Oct-
14
Jan
-15
Ap
r-15
Ju
l-15
Oct-
15
Jan
-16
Ap
r-16
Ju
l-16
Oct-
16
Jan
-17
Ap
r-17
Ju
l-17
Oct-
17
Jan
-18
Ap
r-18
Ju
l-18
Oct-
18
Jan
-19
Ap
r-19
Ju
l-19
30-Year FMR
Fed Funds Rate
10-Year Treasury
Source: Haver Analytics; FHLMC; St. Louis FED;
Real Estate Center at Texas A&M University
Fed Funds Rate, 10-Year Treasury, 30-Year FMR & Inflation
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
7.0
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
7.0
Jan
-07
Ap
r-07
Ju
l-07
Oct-
07
Jan
-08
Ap
r-08
Ju
l-08
Oct-
08
Jan
-09
Ap
r-09
Ju
l-09
Oct-
09
Jan
-10
Ap
r-10
Ju
l-10
Oct-
10
Jan
-11
Ap
r-11
Ju
l-11
Oct-
11
Jan
-12
Ap
r-12
Ju
l-12
Oct-
12
Jan
-13
Ap
r-13
Ju
l-13
Oct-
13
Jan
-14
Ap
r-14
Ju
l-14
Oct-
14
Jan
-15
Ap
r-15
Ju
l-15
Oct-
15
Jan
-16
Ap
r-16
Ju
l-16
Oct-
16
Jan
-17
Ap
r-17
Ju
l-17
Oct-
17
Jan
-18
Ap
r-18
Ju
l-18
Oct-
18
Jan
-19
Ap
r-19
Ju
l-19
30-Year FMR
Fed Funds
10-Year Treasury
Inflation
Source: Haver Analytics; FHLMC; St. Louis FED;
Real Estate Center at Texas A&M University
2015-2016 Oil Decline; Down Years
2017 Recovery – A Good Year
2018: Better than 2017
2019 Some Headwinds, but Not Bad
7
Texas Economy
2018 a Very Good Year Economically For Texas
• Rebound from Harvey going strong but not over
• State GDP +3.7% (3Q18) [estimate ~4.5% 2018]
• Personal Income +5.3% vs. 4.5% nationally
• Oil Prices >$70 until 4Q – dropped then rebounded
• Jobs increased 276,100 +2.3%
• Population increased 379,128 to 28,701,845• 190,951 natural increase (50.3%)
• 104,976 foreign immigration (27.7%)
• 82,569 domestic immigration (22%)
8
Texas Economic Outlook: 2019 Positive but Slower Growth Than 2018
9
U.S. Economy stays relatively strong
Employment: ~1.5% - 2.0% from 2.3% in 2018 (revised)
GDP: 3.5% 2019 from ~4.5% 2018
Energy sector neutral; oil prices $40-$60/bl.
Population expansion continues but at slower pace
Exports doing well and contributing to economy – trade
agreements and value of dollar add uncertainty
Retail Sales steady but not significantly higher
Texas’ Leading Economic Index
95.0
100.0
105.0
110.0
115.0
120.0
125.0
130.0
135.0
140.0
Source: Federal Reserve Bank of Dallas, 1987=100
T
e
c
h
W
r
e
c
k
GreatRecession
Oil Bust
A composite of 8 leading indicators: 1) value of
the dollar, 2) U.S. leading economic index, 3)
real oil price, 4) well permits, 5) initial claims
for unemployment insurance, 6) Texas stock
index, 7) help-wanted index, and 8) average
weekly hours worked in manufacturing.
Weekly Active Texas Rig Count & Price of WTI
11
11/21/2014, 906
5/20/2016, 173
6/27/2014, $106.69
2/12/2016, $28.14
$0$10$20$30$40$50$60$70$80$90$100$110$120$130$140$150$160$170$180
100150200250300350400450500550600650700750800850900950
1,000
1/7
/20
00
4/2
8/2
00
08
/18
/200
01
2/8
/200
03
/30
/200
17
/20
/200
11
1/9
/200
13
/1/2
002
6/2
1/2
00
21
0/1
1/2
00
21
/31
/200
35
/23
/200
39
/12
/200
31
2/3
1/2
00
34
/23
/200
48
/13
/200
41
2/3
/200
43
/24
/200
57
/15
/200
51
1/4
/200
52
/24
/200
66
/16
/200
61
0/6
/200
61
/26
/200
75
/18
/200
79
/7/2
007
12/2
8/2
00
74
/18
/200
88
/8/2
008
11/2
6/2
00
83
/20
/200
97
/10
/200
91
0/3
0/2
00
92
/19
/201
06
/11
/201
01
0/1
/201
01
/21
/201
15
/13
/201
19
/2/2
011
12/2
2/2
01
14
/13
/201
28
/3/2
012
11/2
1/2
01
23
/15
/201
37
/3/2
013
10/2
5/2
01
32
/14
/201
46
/6/2
014
9/2
6/2
01
41
/16
/201
55
/8/2
015
8/2
8/2
01
51
2/1
8/2
01
54
/8/2
016
7/2
9/2
01
61
1/1
8/2
01
63
/10
/201
76
/30
/201
71
0/2
0/2
01
72
/9/2
018
6/1
/20
18
9/2
1/2
01
81
/11
/201
95
/3/2
019
Rig Count
(left)
WTI $/bl.
(right)
Rig Count up 318, +184% since May 2016
Source: Baker Hughes; EIA; RE Center at Texas A&M University
Current and Futures Monthly Average Price of WTI
$30
$40
$50
$60
$70
$80
$90
$100
$110
$120
Ja
n-1
3
Ma
r-13
Ma
y-1
3
Ju
l-1
3
Sep
-13
No
v-1
3
Ja
n-1
4
Ma
r-14
Ma
y-1
4
Ju
l-1
4
Sep
-14
No
v-1
4
Ja
n-1
5
Ma
r-15
Ma
y-1
5
Ju
l-1
5
Sep
-15
No
v-1
5
Ja
n-1
6
Ma
r-16
Ma
y-1
6
Ju
l-1
6
Sep
-16
No
v-1
6
Ja
n-1
7
Ma
r-17
Ma
y-1
7
Ju
l-1
7
Sep
-17
No
v-1
7
Ja
n-1
8
Ma
r-1
8
Ma
y-1
8
Ju
l-1
8
Sep
-18
No
v-1
8
Ja
n-1
9
Ma
r-19
Ma
y-1
9
Ju
l-1
9
Sep
-19
No
v-1
9
Ja
n-2
0
Ave
rag
e M
on
thly
Pri
ce
Cushing Spot Price
6-Month Futures
12-Month Futures
2-Year Futures
12Sources: EIA; Haver Analytics; Real Estate Center at Texas A&M University
Oil Spot Prices: Cushing & Midland
13Sources: Bloomberg; Dallas Federal Reserve Bank;
Real Estate Center at Texas A&M University
Futures contracts for Midland and Cushing crudes show the market expects
their prices to stay in the mid-$50 range through the end of 2019.*
*Permian Basin Economic Indicators, Dallas Federal Reserve Bank, March 22, 2019
Monthly Texas Oil Production & Price of WTI
14
$0.00
$10.00
$20.00
$30.00
$40.00
$50.00
$60.00
$70.00
$80.00
$90.00
$100.00
$110.00
$120.00
$130.00
$140.00
$150.00
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
Ja
n-9
0
Ja
n-9
1
Ja
n-9
2
Ja
n-9
3
Ja
n-9
4
Ja
n-9
5
Ja
n-9
6
Ja
n-9
7
Ja
n-9
8
Ja
n-9
9
Ja
n-0
0
Ja
n-0
1
Ja
n-0
2
Ja
n-0
3
Ja
n-0
4
Ja
n-0
5
Ja
n-0
6
Ja
n-0
7
Ja
n-0
8
Ja
n-0
9
Ja
n-1
0
Ja
n-1
1
Ja
n-1
2
Ja
n-1
3
Ja
n-1
4
Ja
n-1
5
Ja
n-1
6
Ja
n-1
7
Ja
n-1
8
Ja
n-1
9
Ja
n-2
0
Th
ou
san
ds o
f B
arr
els
pe
r D
ay
Tx Oil Production (left)
WTI Price (right)
Source: EIA; RE Center at Texas A&M University
Texas Annual Jobs
15
7,125,7007,204,7007,300,1007,514,500
7,786,6008,059,000
8,292,200
8,643,700
8,973,1009,189,500
9,462,0009,545,0009,447,4009,401,8009,527,700
9,772,900
10,098,900
10,429,60010,643,100
10,341,30010,375,300
10,605,400
10,914,600
11,240,900
11,592,60011,864,800
12,013,60012,227,90012,504,100
12,754,182
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
11,000,000
12,000,000
13,000,000
14,000,0001990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019p
Sources: Texas Workforce Commission, Real Estate Center at Texas A&M University
2014-2018 +1,262,200 jobs;
average 252,440/year
2015 +2.4%
2016 +1.2%
2017 +1.8%
2018 +2.3%
2019p ~2.0%
Monthly Change in Total Nonfarm Employment Texas
-20,000
-10,000
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
-20,000
-10,000
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Jan
-11
Ju
l-11
Jan
-12
Ju
l-12
Jan
-13
Ju
l-13
Jan
-14
Ju
l-14
Jan
-15
Ju
l-15
Jan
-16
Ju
l-16
Jan
-17
Ju
l-17
Jan
-18
Ju
l-18
Jan
-19
Ju
l-19
Jan
-20
Nu
mb
er
of
Jo
bs
, S
A
Change in Monthly Employment Six-Month Moving Average
Sources: TWC; Haver Analytics; Real Estate Center at Texas A&M University
Average of ~21,900 jobs per month since January 2011
Texas Growth
Year
Jobs, NSA
(Dec-Dec)
Population
(July-July)
2010 216,200 439,887
2011 236,200 402,776
2012 373,300 433,903
2013 300,800 400,952
2014 420,900 475,157
2015 151,800 500,444
2016 150,000 449,982
2017 253,900 399,734
2018 276,100 379,128
17Sources: US Census Bureau; Texas Workforce Commission;
Real Estate Center at Texas A&M University
2010-2018
+3,881,963
people
+2,379,200
jobs
Killeen-Temple MSABell County Economic
Outlook
Killeen-Temple MSA
19
Bell
Lampasas
Coryell
Bell County
20
Belton
TempleKilleen
Texas Major MSAs Employment Growth 2017, 2018 & 2019
3.2
2.8
2.3
1.0
2.3
1.8
3.3
2.3
2.6
2.2
1.6
2.3
2.5
1.8
2.2
2.0
1.4
2.0
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
Austin Dallas Fort Worth Houston San Antonio Texas
Pe
rce
nt
Gro
wth
in
An
nu
al
Em
plo
ym
en
t
2017 2018 2019
21Sources: TWC; Real Estate Center at Texas A&M University
Austin & Texas Business-Cycle IndexesMonthly, Seasonally Adjusted, 10/1980=100
50100150200250300350400450500550600650700750800850900950
1000
Jan
-00
Jan
-01
Jan
-02
Jan
-03
Jan
-04
Jan
-05
Jan
-06
Jan
-07
Jan
-08
Jan
-09
Jan
-10
Jan
-11
Jan
-12
Jan
-13
Jan
-14
Jan
-15
Jan
-16
Jan
-17
Jan
-18
Jan
-19
Jan
-20
22Source: Federal Reserve Bank of Dallas
Austin
Texas
Austin Annual Jobs
396,000408,800
430,800
461,000
492,000
524,900549,700
575,600
610,500
645,900
684,000685,300669,300663,900
679,000704,700
736,400
772,100791,100
774,300785,500
811,900
844,400
884,100
923,000
963,300
1,000,900
1,034,700
1,069,1001,095,828
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
1,100,000
1,200,0001990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019p
23Sources: Haver Analytics; Real Estate Center at Texas A&M University
2015 +4.4%
2016 +3.9%
2017 +3.4%
2018 +3.3%
2019p +2.5%
Bell County Annual Employment
24
89,41891,011
97,22797,989
100,809102,007
105,164
108,380109,785
113,309
116,433118,431
121,669122,763
124,194125,981127,044
129,832
132,983135,305
137,877139,945
80,000
90,000
100,000
110,000
120,000
130,000
140,000
150,0001
99
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
201
9p
2016 +2.4%
2017 +1.8%
2018 +1.9%
2019p +1.5%
Sources: Haver Analytics; Real Estate Center at Texas A&M University
Bell County Unemployment Rate
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
20
09
- J
an
20
09
- J
ul
20
10
- J
an
20
10
- J
ul
20
11
- J
an
20
11
- J
ul
20
12
- J
an
20
12
- J
ul
20
13
- J
an
20
13
- J
ul
20
14
- J
an
20
14
- J
ul
20
15
- J
an
20
15
- J
ul
20
16
- J
an
20
16
- J
ul
20
17
- J
an
20
17
- J
ul
20
18
- J
an
20
18
- J
ul
20
19
- J
an
Perc
en
t U
nem
plo
yed
25
Killeen-Temple Employment by Industry
Mining, Logging and Construction, 5%
Manufacturing, 5%
Trade, Transportation, and
Utilities, 19%
Information, 1%
Financial Activities, 5%
Professional and Business Services,
8%Education and Health
Services, 17%
Leisure and Hospitality, 11%
Other Services, 4%
Government, 27%
Sources: Texas Workforce Commission, Real Estate Center at Texas A&M University
Killeen-Temple Jobs and Annual Job Growth Rate
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
122,500
125,000
127,500
130,000
132,500
135,000
137,500
140,000
142,500
145,000
147,500
Feb
-09
Ju
n-0
9
Oct-
09
Feb
-10
Ju
n-1
0
Oct-
10
Feb
-11
Ju
n-1
1
Oct-
11
Feb
-12
Ju
n-1
2
Oct-
12
Feb
-13
Ju
n-1
3
Oct-
13
Feb
-14
Ju
n-1
4
Oct-
14
Feb
-15
Ju
n-1
5
Oct-
15
Feb
-16
Ju
n-1
6
Oct-
16
Feb
-17
Ju
n-1
7
Oct-
17
Feb
-18
Ju
n-1
8
Oct-
18
Feb
-19
Employment Count Annual Growth Rate
27Sources: Texas Workforce Commission, Real Estate Center at Texas A&M University
Texas Demographics
28
Pecos
Brewster
Webb
Hudspeth
PresidioTerrell
Culberson
Reeves
Val Verde
Crockett
Hill
Duval
Harris
Frio
Bell
Kerr
Kenedy
Starr
Polk
Clay
Edwards
Irion
Hall
Ellis
Jeff Davis
Sutton
Uvalde
Bee
Hale
Dallam
Leon
Bexar
Gaines
Hidalgo
Upton
Hartley
King
Erath
Jack
Kinney
Kent
Zavala
Brazoria
Tyler
GrayOldham
Dimmit
CassLynn HuntWise
Kimble
Lamb
Medina
Floyd
Terry
Coke
Llano
Ector
Andrews
Milam
Travis
Knox
Falls
Ward
Collin
Jones
Nolan
Potter
Nueces
Taylor
Real
Bowie
Young
Lamar
Martin
Garza
DallasFisher
Moore
Kleberg
Cameron
Cooke
Hardin
Schleicher
Gillespie
Foard
Wood
Menard
La Salle
Rusk
LibertyLee
Mills
Smith
Burnet
Cottle
Zapata
Coryell
Matagorda
Brown
Motley
Reagan Houston
Maverick
Jasper
Coleman
BaylorArcher
Scurry
Tom Green
Mason
Parker
Castro
Navarro
Brooks
Bailey
Deaf Smith
DeWitt
Lavaca
Donley
Hays
Goliad
Atascosa
Denton
BosqueEl Paso
Fannin
Tarrant
Wharton
CraneConcho
Carson
Runnels
Fayette
Crosby
Borden
Haskell
Calhoun
Newton
Live Oak
Randall
ShelbySterling
Jefferson
Briscoe
McMullen
Parmer
Jim Hogg
Mitchell
Wilson
Victoria
Trinity
Roberts
PanolaHoward
Walker
Bastrop
Grayson
San Saba
Midland
Hockley
Dickens
Swisher
Gonzales
Winkler Anderson
Dawson
Willacy
Grimes
Wheeler
Cherokee
Harrison
Colorado
Eastland
Lubbock
Karnes
Red River
Refugio
Austin
Hemphill
Williamson
Jackson
Blanco
Ochiltree
McCulloch
Loving
Sherman
Wilbarger
Hansford
Callahan
McLennan
Yoakum
Angelina
Hopkins
Lipscomb
StephensPalo Pinto
Stonewall
Hamilton
Montague
Bandera
Cochran
Jim Wells
Limestone
Kaufman
Fort Bend
Titus
Comal
Armstrong
Kendall
Freestone
Comanche
Glasscock
Johnson
Galveston
Henderson
Montgomery
Wichita
Brazos
Van Zandt
Chambers
Robertson
Waller
Sabine
Upshur
Hood
Hutchinson
Shackelford
Childress
Burleson
Nacogdoches
Lampasas
Collingsworth
Hardeman
Throckmorton
Guadalupe
Caldwell
Aransas
Marion
San Patricio
Madison
San Jacinto
Delta
WashingtonOrange
Rains
Gregg
Morris
San Augustine
Franklin
Somervell
Rockwall
Estimated Population Change, Texas Counties, 2010 to 2017
29Source: U.S. Census Bureau, 2017 Vintage Population Estimates;
Texas State Demographer’s Office
87% E
of I-35
67% in
Urban
Triangle
91 counties lost population over the 7 year period.
tl_2017_us_county
NumCh10-17
-2,139 - 0
1 - 1,000
1,001 - 20,000
20,001 - 100,000
100,001 - 560,521
Texas Population 1910-20502018 Population Projection & 2017 Texas Water Plan
11,196,730
54,369,297
25,145,561
47,342,417
41,928,264
0
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
1910
1920
1930
1940
1950
1960
1970
1980
1990
2000
2010
2015
2020
2025
2030
2035
2040
2045
2050
30
From 1970 to 2010 (40 years),
Texas added 13.9 million people
From 2010 to 2050 (40 years),
Texas will probably add ~17- 30
million people
Sources: U.S. Census Bureau; Texas State Demographer’s Office 2018
Projection & 2000-2010 Scenario; Real Estate Center at Texas A&M University
2017 Texas
State Water
Plan
Revised 2018
Projection
(2010-2015
Rate)
2000-2010
Projection
Projected Population Change, Texas Counties, 2010-2050
31
Source: Texas State Data Center 2012
Population Projections . 2000-
2010 Migration Scenario
Legend
tl_2010_48_county10
F6
-6,200 - 0
1 - 2,000
2,001 - 10,000
10,001 - 100,000
100,001 - 1,000,000
1,000,001 -3,480,000
90%+ in the
Urban Triangle
Austin MSA PopulationBastrop, Caldwell, Hays, Travis & Williamson Counties
301,261585,051
1,249,763
1,716,289 2,246,558
2,867,566
3,624,734
4,542,827
5,176,940
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
1960 1970 1980 1990 2000 2010 2015 2020 2025 2030 2035 2040 2045 2050
32Source: U.S. Census Bureau; Texas State Demographer’s Office 2018 Projection &
2000-2010 Projection; Real Estate Center at Texas A&M University
2010-2050 2,826,538; 165% increase
70,663/year average
Williamson County Population
37,305
422,679
633,783
940,542
1,380,749
1,976,958
1,638,796
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
1970 1980 1990 2000 2010 2015 2020 2025 2030 2035 2040 2045 2050
33Source: U.S. Census Bureau; Texas State Demographer’s Office 2014
Projection; 2000-2010 Scenario
2010-2050 1,216,117; 288% increase
30,400/year average
Killeen-Temple MSA PopulationBell, Coryell & Lampasas Counties
169,117
268,820
405,300 477,112
524,884570,097
591,103
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
1970 1980 1990 2000 2010 2015 2020 2025 2030 2035 2040 2045 2050
34Source: U.S. Census Bureau; Texas State Demographer’s Office 2018 Projection;
Real Estate Center at Texas A&M University
2010-2050 185,803; 46% increase
4,650/year average
Bell County Population
124483
310,235
353,615
396,685
440,487
482,318
0
250000
500000
750000
1970 1980 1990 2000 2010 2015 2020 2025 2030 2035 2040 2045 2050
35Sources: U.S. Census Bureau; Texas State Demographer’s Office 2018
Projection; Real Estate Center at Texas A&M University
2010-2050 172,083; 55% increase
4,300/year average
36
Texas Housing
Market
2018 A Solid Year For Housing Around the State
• Total Housing Activity: 2018 vs. 2017
• Sales +1.7% 343,833 vs. 336,502 $97.7B vs. $92.4B
• Listings +1.4% 101,603 vs. 100,664
• DoM 58 vs. 57
• MOI 3.4 vs. 3.1
• Average Price +3.7% $284,173 vs. $274,580
• Median Price +4.5% $233,000 vs. $223,990
• Md. Price/sq. ft. +5% $116.37 vs. $110.55
• Avg. Price/sq. ft. +4.3% $128 vs. $122
37Source: TAR Data Relevance Program; Real Estate Center at Texas A&M University
2018 A Solid Year For New Housing Around the State
• New Home Construction lead the nation• State 168,500 total starts, ~122k SF ~47k MF
• DFW 57.9K (35.1k SF, 22.8k MF); Houston 50.8k (41.3k SF, 9.5k MF)
• New Home Sales stayed strong• New home sales +8.1%
• DoM 93
• MOI 5.1
• Average price -0.4%
• Median price +0.2%
• Price/sq. ft. +2.9%
38
2018 Percent Changes in Key Housing Measures
39
Sales
Average
Price
Median
Price
Months
Inventory
Median
Price/sf
Texas 1.7% 3.7% 4.5% 9.8% 5.0%
Austin 1.4% 4.2% 3.9% 9.7% 3.9%
DFW -2.4% 4.1% 3.9% 19.7% 5.7%
Houston 3.4% 2.7% 3.1% 13.5% 4.2%
San
Antonio 2.9% 4.2% 5.2% 8.0% 5.5%
Source: TAR Data Relevance Program; Real Estate Center at Texas A&M University
2019 Home Market SlowdownFactors that may create a drag on home-buying demand
• Limited inventory availability
• Higher prices - affordability
• Increasing interest rates
• Concerns about general economy –fear of recession or jobs
• Stock market volatility
• Negative press coming off record year(s)
40
March 2019 Residential Sales Slowed Down; Price/Sq. Ft. Still Up
41
Sales 0.7% YTD
Price +3.4% YTD
Source: TR Data Relevance Program; Real Estate Center at Texas A&M University
Source: TAR Data Relevance Program; Real Estate Center at Texas A&M University
103,344102,789110,830
120,749126,525
126,279
142,940
151,861
177,179
191,189195,568
204,084209,438
224,215
250,380
277,649
304,762
286,778
241,666
221,768211,640213,968
247,680
287,833297,623
309,274
323,661
338,178343,833
347,271
$50,000
$70,000
$90,000
$110,000
$130,000
$150,000
$170,000
$190,000
$210,000
$230,000
$250,000
$270,000
$290,000
$310,000
$330,000
$350,000
$370,000
$390,000
50,000
70,000
90,000
110,000
130,000
150,000
170,000
190,000
210,000
230,000
250,000
270,000
290,000
310,000
330,000
350,000
370,000
390,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
p
Sales Avg Price Md Price
2018
Sales 1.7% Prices ~4%
2019p
Sales ~1%, Prices ~3.5%
Annual Texas Home Sales & Prices
42
2010-2018
Sales +64%,
Average Price +49%,
Median Price +59%
Texas Home Sales per 1,000 Households
17.016.617.5
18.819.4
18.9
20.921.8
24.9
26.326.527.327.7
29.4
32.1
34.8
37.6
34.8
28.7
26.0
24.224.1
27.5
31.532.0
32.833.9
35.1
10
12
14
16
18
20
22
24
26
28
30
32
34
36
38
40
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
Source: TAR Data Relevance Program; US Census Bureau;
Real Estate Center at Texas A&M University
1990-2000 Average 20.8
2001-2017 Average 30.6
Texas Median Home Prices Continue to Climb
$68,470$71,656
$75,525$78,396$80,294$81,851
$86,462$90,879
$96,063$100,952
$111,642$118,808
$123,725$127,017$128,883
$135,788$141,905
$146,105$145,613$144,633$146,417$147,000
$156,800
$170,000
$182,500
$195,372
$210,000
$223,000
$233,000
$241,155
$50,000$60,000$70,000$80,000$90,000
$100,000$110,000$120,000$130,000$140,000$150,000$160,000$170,000$180,000$190,000$200,000$210,000$220,000$230,000$240,000$250,000
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
201
9p
44
2017 +6.2%;
2018 +4.5%
2019p +3.5%
2012-2018p +49%
Source: TAR Data Relevance Program; Real Estate Center at Texas A&M University
Texas Median HH Income & Median Home Price Indexed to 1989
60
80
100
120
140
160
180
200
220
240
260
280
300
320
340
360
60
80
100
120
140
160
180
200
220
240
260
280
300
320
340
360
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Sources: U.S. Census Bureau; Haver Analytics; Real Estate Center at Texas A&M University
2017 Adjusted HH Income +20%
Nominal HH Income +129%
Median Home Price +226%
1989 Median Price = 2.65 x Median HH Income
2017 Median Price = 3.76 x Median HH Income
11,879
14,270
38,706
64,530
60,366
44,992
53,004
24,626
19,602
5,197
5,087
80,000 60,000 40,000 20,000 0
2018 Sales
Texas 2018 Sales and Months Inventory by Price
46
3.6
3.2
2.4
2.2
2.7
3.4
3.9
4.5
5.3
7.5
10.3
0.0 2.0 4.0 6.0 8.0 10.0 12.0
$0 - $69,999
$70,000 - $99,999
$100,000 - $149,999
$150,000 - $199,999
$200,000 - $249,999
$250,000 - $299,999
$300,000 - $399,999
$400,000 - $499,999
$500,000 - $749,999
$750,000 - $999,999
$1,000,000 +
Current Mos. Inventory
Source: TAR Data Relevance Program; Real Estate Center at Texas A&M University
3.5%
4.2%
11.3%
18.9%
17.6%
13.1%
15.5%
7.2%
5.7%
1.5%
1.5%
About 61% of
sales in $100k
to $300k range
Very Tight
Inventory
to $300k
Texas SF Building Permits
38,233
46,209
59,543
69,96470,45270,421
83,13282,228
99,912101,928108,782
111,915
122,913
137,493
151,384
166,203163,032
120,366
81,107
68,230
68,170
67,254
81,926
93,478
103,045105,448
106,511
116,766123,772
127,485
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8p
201
9p
Source: US Census Bureau; NAHB; Real Estate Center at Texas A&M
2015 +2.3%
2016 +1.0%
2017 +9.6%
2018e +6%
2019p +3%
1995-2017 average
104,854/year
Texas MF Building Permits
8,96210,2989,514
15,545
32,23734,68435,720
43,794
56,918
44,716
32,620
38,427
42,40943,081
39,796
44,431
53,894
58,542
49,897
17,375
21,504
32,260
56,40656,644
67,319
69,995
59,34258,34656,596
54,898
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8e
201
9p
Source: US Census Bureau, Real Estate Center at Texas A&M
1995-2016 average 45,444/year
2017 -1.7%; 2018p -3%
Texas Residential Construction Leading and Coincident Indexes
Jan 2000=100
40
60
80
100
120
140
160
180
40
60
80
100
120
140
160
180
Jan
-00
Ju
l-00
Jan
-01
Ju
l-01
Jan
-02
Ju
l-02
Jan
-03
Ju
l-03
Jan
-04
Ju
l-04
Jan
-05
Ju
l-05
Jan
-06
Ju
l-06
Jan
-07
Ju
l-07
Jan
-08
Ju
l-08
Jan
-09
Ju
l-09
Jan
-10
Ju
l-10
Jan
-11
Ju
l-11
Jan
-12
Ju
l-12
Jan
-13
Ju
l-13
Jan
-14
Ju
l-14
Jan
-15
Ju
l-15
Jan
-16
Ju
l-16
Jan
-17
Ju
l-17
Jan
-18
Ju
l-18
Jan
-19
Ju
l-19
Jan
-20
Source: Real Estate Center at Texas A&M University
Leading Index
Coincident Index
Total Housing
Permits (12-MMA)
49
Texas Single-Family Housing Markets Expected to Slow Down in 2019
50Source: Real Estate Center at Texas A&M University
Texas (2018 (%) 2019 (%) 1991-2018 (%)Housing Permits 5.7 2.1 5.4
Sales 1.8 0.9 4.6
Price per square foot 4.4 4.0 4.8
Austin
Housing Permits 9.6 0.2 11.4
Sales 2.3 2.8 6.1
Price per square foot 4.5 4.0 6.3
DFW
Housing Permits 5.3 3.3 4.7
Sales -2.2 0.3 5.0
Price per square foot 5.3 4.4 4.6
Houston
Housing Permits 4.1 0.1 5.9
Sales 3.5 1.1 3.9
Price per square foot 3.1 4.6 5.3
San Antonio
Housing Permits 9.7 10.5 7.9
Sales 2.3 -1.0 6.8
Price per square foot 5.2 3.9 4.6
51
Killeen-Temple/
Bell County
Housing Markets
3,327
3,544
2,600
3,710
4,173
5,8525,555 5,339
4,6314,505
4,411
3,764
4,197
4,633
5,035
5,526
6,082
6,335
6,612
6,810
$80,000
$90,000
$100,000
$110,000
$120,000
$130,000
$140,000
$150,000
$160,000
$170,000
$180,000
$190,000
$200,000
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
7,500
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
p
Sales Avg Price Md Price2018 sales +4.4%,
prices +4.6%
2019p sales ~3.0%,
Prices ~4%
Annual Killeen-Temple Home Sales & Prices
52Source: Temple-Belton BoR; Real Estate Center at Texas A&M University
Source: Temple-Belton BoR; Real Estate Center at Texas A&M University
3,095
3,496
3,758
4,119
4,567
4,983
5,2065,322
5,455
$120,000
$130,000
$140,000
$150,000
$160,000
$170,000
$180,000
$190,000
$200,000
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,0002
01
1
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
p
Sales Avg Price Md Price2018 sales +2.2%,
prices +5.0%
2019p sales ~2.5%,
Prices ~3.5%
Annual Bell County Home Sales & Prices
53
283
510
1,383
1,498
675
414
331
112
70
13
5
2,000 1,500 1,000 500 0
2018 Sales
Bell County 2018 Sales and Months Inventory by Price
54
2.3
1.6
1.4
2.2
4.6
4.5
5.8
4.8
7.5
13.8
0.0 2.0 4.0 6.0 8.0 10.012.014.016.0
$0 - $69,999
$70,000 - $99,999
$100,000 - $149,999
$150,000 - $199,999
$200,000 - $249,999
$250,000 - $299,999
$300,000 - $399,999
$400,000 - $499,999
$500,000 - $749,999
$750,000 - $999,999
$1,000,000 +
Current Mos. Inventory
5.3%
9.6%
26.1%
28.3%
12.8%
7.8%
6.3%
2.1%
1.3%
0.2%
0.1%
About 67% of
sales in $100k
to $250k range
Very Tight
Inventory
to $200k
21.6 months
Source: Temple-Belton BoR; Real Estate Center at Texas A&M University
March 2019 Killeen-Temple Residential Sales & Price/Sq. Ft.
55
Sales +12.1% YTD Price +3.5%YTD
BeltonTempleKilleen
Lampasas
Coryell
Salado
BeltonTempleKilleen
Lampasas
Coryell
Salado
Source: Temple-Belton BoR; Real Estate Center at Texas A&M University
March 2019 Bell Co. Residential Sales & Price/Sq. Ft.
56
Sales +13.4% YTD
Existing +20%
New -11.2%
Price/sf +0.7%YTD
Median +2.6%YTD
Sales & Prices by Zip Code
BeltonTemple
Killeen
Salado
BeltonTemple
Killeen
Salado
2.6 Months Inventory
Source: Temple-Belton BoR; Real Estate Center at Texas A&M University
57
58
Bell County SF Permits
433437
945
1,269
928
1,3371,327
844
683
470
196
343
1,047
1,461
1,2961,3251,315
1,0821,1551,179
1,321
1,515
1,7691,857
2,351
3,047
2,514
2,270
1,599
1,8411,750
1,646
1,8461,8611,848
1,6801,5811,600
1,827
1,845
0
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
2,500
2,750
3,000
3,250
198
0
198
1
198
2
198
3
198
4
198
5
198
6
198
7
198
8
198
9
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8e
201
9p
59Source: US Census Bureau; Real Estate Center at Texas A&M University
2017 +1%; 2018e +14%; 2019p
+1%
Bell County MF Permits
200244304
1,822
482
878
29105
0 20 0 0 0 0 28
364337302
1280 30 0
182
24
272228
729
72
256224
72
239200125
0 0
290405
110
3346
170
208
259
219
13452
24 7 2 9 4 2644
164272287
234
246
444
688
902
446
786
394
868
478
303
82
92
140284
121
143
362
236
242
240
0
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
198
0
198
1
198
2
198
3
198
4
198
5
198
6
198
7
198
8
198
9
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8e
5+ Units 2-4 Units
60Source: US Census Bureau; Real Estate Center at Texas A&M University
Longer-Term Outlook• Population Growth Continues to Outpace U.S.;
Concentrated in Urban Triangle
• Infrastructure Trying to Keep Up with Growth: roads, water/sewer, utilities, schools• Water West of I-35 Major Limiting Factor for Growth
• Infrastructure Financing higher rates; bond market competition for capital; private vs. public financing; taxes
• Land and land resources & government regulatory actions
• Money Capital & Money Markets: debt, inflation and interest rates
61
Dr. James P. GainesChief Economist
recenter.tamu.edu