Houston property market is feeling some form of impact brought about by the decline in global oil prices.
As reported by KTRH, Houston's real estate market has cooled down as the oil prices fell to $40 per barrel. The region saw a boom in the property market coincidentally when oil prices were at $100 per barrel two years ago.
According to the report, local oil companies are struggling given the current global prices, which resulted in tens of thousands of jobs being axed. Laid off employees consequently make changes upon losing their jobs, which probably is the main reason for their stay in the region.
But the impact on housing market doesn't seem that drastic. Christi Borden, a Realtor with Better Homes & Gardens Real Estate Gary Greene, said, "We're not seeing falling prices, but we're not seeing the growth that we have had in the past."
Houston's energy sector is closely tied to the region's property market, particularly commercial real estate. According to Forbes, as oil prices dropped over 70 percent since mid-2014, office vacancies in Houston have more than doubled by the end of 2015 to an estimated 8 million square feet. Forbes noted that most of these space were previously occupied by energy companies.
Furthermore, Goldman Sachs said in a recent analysis that commercial property loans in Houston are at risk of default because of the increasing vacancy rates.
Meanwhile, doubts that the world's largest oil exporters will be able to agree on a production freeze when they meet in Doha this April held oil prices close to their lowest for a month, Reuters reported. Most recently, Saudi Arabia said that it will not cut production if Iran will do so.
Brent crude futures only inched up 14 cents to $38.81 per barrel by 1232 GMT on Monday while U.S. crude futures rose 22 cents at $37.01.
