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June 2008

MAY REVENUE (in millions): SALES TAX: $1,877.5 OIL PRODUCTION: $123.6 NATURAL GAS: $249.2
MOTOR FUELS: $258.6 MOTOR VEHICLE SALES: $269.4 TOBACCO: $137.7


Key Stats for Local Development

A new Web portal lets local professionals and officials examine key data about their communities and download special tools that can help support their economic growth.

Texas Ahead not only gives access to targeted tools and a closer look at tax programs and incentives, but also provides relevant and current information on the forces driving the Texas economy, including regular economic updates and forecasts. The Texas Comptroller of Public Accounts recently launched the portal.

You can also gather valuable details for site selection decisions, local government planning and more by running your own reports on categories including Texas population, demographics and sales tax allocations.

In addition, Texas Ahead lets you view economic development and business case studies that provide valuable guidance and models worth imitating. For more information, visit www.TexasAhead.org.



Texas Population Heats Up

State’s four metro areas among nation’s top 10 in population growth

By Karen Hudgins

Las Vegas residents Lisa and Kevin Wright pulled up stakes and moved their business and family to Texas in 2006. Having lived in the San Antonio area about 20 years earlier, the Wrights were familiar with Texas and wanted a better place to raise their two young children.

The Wright family was attracted to business opportunities and quality of life in Texas.

“We wanted a little slower pace of life,” Lisa says. “Once we found out about all of the economic development going on in Texas, and Williamson County in particular, we thought that would be a great place to have our business.”

The Wright family is not alone in choosing Texas. The state’s four major metro areas, Dallas, Houston, San Antonio and Austin, were among the top 10 in the nation with the highest population growth between July 2006 and July 2007, according to the U.S. Census Bureau (See Box: Population Boom).


Good for Business

Many have moved to Texas for economic or business reasons, says Texas State Demographer Karl Eschbach, who notes that the state’s robust economy has been a big draw.

“Job creation in Texas’ principal metropolitan areas was significantly greater in 2006-2007 than in other areas, and unemployment rates were lower,” he says.

Wright and her husband own a financial planning firm that focuses on planning for divorce and financial settlements. While they moved to Central Texas initially to find a better quality of life, they’ve found it’s been a boost to their business.

“It’s not that there is more divorce here, but it’s just that there are fewer practitioners here who do what I do,” Lisa says. “Our income and earnings have all been very positive.”

  • green
  • Texas
  • orange
  • Other States

Population Boom

Texas’ four major metro areas ranked among the nation’s top 10 in population growth
between July 2006 and July 2007.

  • Metro Area
  • Population Growth
  • Dallas-Fort Worth-Arlington, TX
  •  
  • 162,250
  • Atlanta-Sandy Springs-Marietta, GA
  •  
  • 151,063
  • Phoenix-Mesa-Scottsdale, AZ
  •  
  • 132,513
  • Houston-Sugar Land-Baytown, TX
  •  
  • 120,544
  • Riverside-San Bernadino-Ontario, CA
  •  
  • 86,660
  • Charlotte-Gastonia-Concord, NC-SC
  •  
  • 66,724
  • Chicago-Naperville-Joliet, IL-IN-WI
  •  
  • 66,231
  • Austin-Round Rock, TX
  •  
  • 65,880
  • Las Vegas-Paradise, NV
  •  
  • 59,165
  • San Antonio, TX
  •  
  • 53,925

Source: U.S. Census Bureau

Migrating West

Movement from other states and countries has contributed to Texas’ population growth, Eschbach says. “International immigration has been steady for more than a decade. In many other states, U.S.-born populations are moving out as international immigrants move in. In Texas, both groups continue to move to the same metropolitan areas.”

Having more births than deaths is also a huge factor, says the U.S. Census Bureau.

Of the total population increase of more than 3 million in Texas from April 1, 2000 to July 1, 2007, more than half, or 1.6 million, was due to this natural increase, says the bureau’s Greg Harper. “Texas also added about 580,000 people due to internal migration (movement to Texas from other states) and about 840,000 due to international migration,” he says.

Housing is Big

The Wright family chose Georgetown partly for its affordable housing prices. They purchased a home on a 1.5-acre tract – plenty of room for daughter Whitney, 11, and son Jack, 9, to ride bicycles and play.

“We were actually able to get a bigger home with more land for about half the price of what we sold our home for in Las Vegas,” Wright says. “We have a bigger, better quality house on about three times the land. Our kids literally feel like we bought them a farm. They can take the bus to school, and they can ride their bikes in the neighborhood.”

Metropolitan Area House Prices

House prices declined nationally during the fourth quarter of 2007 for the second consecutive period. Areas in Texas that Global Insight has long categorized as undervalued are attracting significant migration at the expense of the much higher-cost metropolitan areas of California and Florida.

Average Price-Fourth quarter, 2007
(in thousands of dollars)

Honolulu, HI
 
$664.2
Portland, OR
 
$311.1
Bend, OR
 
$308.1
Riverside-San Bernadino, CA
 
$303.9
Miami, FL
 
$293.1
Austin, TX
 
$173.6
Dallas, TX
 
$134.5
Houston, TX
 
$119.3
San Antonio, TX
 
$113.7

Overvaluation

Global Insight examined house prices and interest rates, household incomes and other factors for 330 metropolitan areas to determine what house prices should be. Based on a historical examination of 102 actual metro area price corrections during 1985-2007, it considered house price valuations in excess of 32 percent “severe” and presented a risk of substantial price declines (10 percent or greater) going forward. It designated such areas as “overvalued.”

Overvaluation–Fourth quarter, 2007

Honolulu, HI  43.5%
 
Portland, OR  41.4%
 
Bend, OR  59.8%
 
Riverside-San Bernadino, CA 33.2%
 
Miami, FL  43.1%
 
 
-10.5%  Austin, TX
 
-30.0%  Dallas, TX
 
-29.1%  Houston, TX
 
-12.1%  San Antonio, TX

Source: Global Insight’s House Prices in America, 2008

The Wrights are typical of many who have come to Texas in recent years.

“Relatively affordable housing in Texas has contributed to the advantages of Texas in attracting businesses and new residents, particularly when compared to states like Arizona and Florida, which have been fast-growing states, but have been particularly hard hit by the difficulties in sub-prime mortgage markets,” Eschbach says.

“Texas has not been immune to these difficulties, but its exposure to sub-prime lending has been lower than these other states. Appreciation of house prices in Texas has been more tied to population growth than to excessive speculation.”

Despite a national downturn in housing, Texas is still a great place to buy a home, says Kiersty Lombar, a real estate agent with Keller Williams’ Central Texas Elite Homes.

“Much like California, there’s something for everyone – Hill Country living, rural areas, investment opportunities, coastal living, urban living,” Lombar says. “The difference? In Texas, you can actually afford it.”

In 2007, Forbes magazine ranked Dallas and Austin the 9th and 10th most affordable metro areas, respectively, to buy a home in the United States.

Border Changes

Border areas have seen large population growth. Between July 2006 and July 2007, El Paso added 9,110 residents for a 1.3 percent population bump. El Paso County gained 74,000 residents through natural increase and 31,000 through international migration from 2000 to 2007. It lost about 47,000 residents over the same time period due to internal migration, or migration to other counties in the U.S., either inside or outside of Texas. “The border region has been growing quickly in the past decade, though that has cooled in the past year,” says Eschbach. “Hidalgo County (McAllen) remains an area of particularly rapid growth in the border region.

“Much of West Texas and the Panhandle experience more stable population patterns, with steady out-migration to the larger metropolitan centers,” Eschbach says.

Lubbock added 2,149 residents from July 2006 to July 2007, a 0.8 percent increase. Lubbock County added about 18,000 people from 2000 to 2007. Harper says almost all of this growth, about 14,000, was due to natural increase. About 3,000 new residents moved into Lubbock County from other parts of the U.S., and migration from other countries added another 2,000.

The Human Factor

The population boom in Texas’ metro areas has affected nearby bedroom communities.

“The suburban areas around the major cities of Houston, Dallas, Austin and San Antonio are experiencing the most rapid growth in percentage terms as suburbanization of both business and residences continues,” Eschbach says. “However, in absolute terms, Harris County added the most new residents in the state. Austin and Fort Worth experienced particularly robust growth among core metropolitan counties.”

Housing and the economy may factor into Texas’ population increase, but quality of life remains the biggest draw for the Wrights, of Georgetown.

“We have 40 oak trees on our property, and we’re a mile from Lake Georgetown and a few miles from Berry Creek Golf Course,” Lisa says. “We have everything we want for our lifestyle. We play golf. We like the lake. We like to run and hike.”

And Texas’ people may be its biggest asset.

“We love the Texas culture, the friendliness, the people who help one another and the community spirit,” she says. “Our move here has enriched our quality of life.” FN

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