3 Cities Where New Home Construction is Booming

by on April 16, 2014Shannon O'Brien

Toward the end of each month, the U.S. Census Bureau and the Department of Housing and Urban Development release residential construction activity statistics for the previous month.

The statistics are broken down into several categories; the most heavily anticipated being the number of groundbreakings – which they refer to as “housing starts” – and the number of building permits issued. The latter is an indication of future new home construction.

New home construction is booming in Houston, Texas and other citiesPretty much everything having to do with the nation’s new construction housing market came to a standstill during the recession. Developers tried to unload cul-de-sacs filled with half-finished homes to other developers rather than shell out the funds to finish them. The number of building permits issued across the country declined significantly.

Last November, according to the aforementioned statistics, housing starts picked up, only to plummet again in January and February. In some cities, however, they won’t be waiting for the official statistics to determine the health of their new-home market. The air is filled with the sounds of hammering and backhoes as new construction positively booms.

1. Houston, Baytown, Sugar Land

“Houston, Sugar Land, Baytown” is a designated metro area located in southeast Texas. The area tops the list of cities for the sheer volume of new homes going up. The city of Houston, in fact, had more new housing starts last year than the entire state of California, according to CultureMap Houston’s Ralph Bivens.

This is happening despite a shortage of quality lots in the city and the need for construction labor. In fact, Bivens says that if all goes well, builders could be adding 50,000 new homes to the Houston market this year.

Not only are there plenty of new homes, but look for many of them to be situated in new master-planned communities. Pomona is one of those communities, created by Ross Perot, Jr. and located in Manvel, about 25 minutes southeast of Houston.

Right now, new homes in the Houston metro area are priced from $106,000 to more than $1 million.

If you’re looking for a job in energy, healthcare or construction and want a brand new house to go along with it, head to Houston, Texas.

2. Dallas, Fort Worth, Arlington

There’s no surprise in the fact that the state of Texas has two cities with the country’s largest amount of new home construction. Strong economies typically see lots of new home construction, and Texas has the strongest economy in the nation.

“Dallas, Fort Worth, Arlington” is also a designated metro area, which locals typically refer to as “The Metroplex.” This part of Texas is experiencing the highest number of new home starts in seven years, according to Steve Brown, with the Dallas News.

In the first three months of this year, Metroplex builders started 7,316 new homes, which is a 59.3 percent increase over the same period last year. There are more to come, as well, with over 19,000 lots being prepared for construction. While Houston sees growth continuing beyond 2016, however, Dallas officials expect this year to be the peak in new home construction.

The median price for a new home in Dallas is a bit over $264,000, which is 8 percent more than last year’s median, Ted Wilson with Dallas consulting firm Residential Strategies tells the Star-Telegram.

Builders have faced the same labor shortages in northern Texas that they’re experiencing in Houston. If it doesn’t turn around, the lack of construction workers may put downward pressure on the new housing market in the area.

You’ll find most of the master-planned communities in northwest Dallas. McKinney is exploding with new construction. Are you shopping for homes in Fort Worth? One of the newest communities there is Stone Crossing, and it’s almost sold out.

3. Orlando

If you’re starting to get the impression that the hottest new home markets are in warm-weather areas, you’re right. Orlando, Fla., comes in at number three on our list of cities with the highest number of new homes under construction.

Central Florida took a huge hit during the recession, finally recovering in 2013. In fact, the recovery was so complete that 350 potential buyers per month toured the sales center at one of Orlando’s new home communities.

Builders took out $3.2 billion in permits last year – a 51 percent increase over 2012. They’re showing that same sort of faith in the economy and the recovery this year.

Central Florida builders are facing some of the same challenges as their cohorts in Texas, however, with labor shortages being the biggest. The demand for new homes is creating the shortage, which, in turn, is slowing down construction, according to the Orlando Business Journal.

If you like warm weather (and who doesn’t after last winter?) and you’re looking for a job, a new home or both, you’ll find plenty of both in Texas and Florida.

{ 3 comments… read them below or add one }

Heba Salah October 29, 2014 at 12:44 am

Looking forward to cooperate in real estate in United Arab Emirates .


April May 3, 2014 at 3:25 am

Your advice is amazing. I am planning to enter the real estate business and your blog has helped me understand the market more. I think I’ll be reading more from this blog from now on. Your blog is indeed valuable to those who would want to enter the biz.


Shannon O'Brien May 7, 2014 at 9:39 pm

Thanks! Unfortunately, I won’t be blogging here much. Check out the Market Leader blog though. I think you’ll like it. http://www.marketleader.com/blog/


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