What is the Climate for Housing in South Texas?

Bart Braselton, Executive VP of Braselton Homes- Largest HomeBuilder in the Corpus Christi Area - 3rd Generation Builder in Coastal Bend- Family in Construction Business for 70 Years.- Degrees in Financing and Real Estate from The University of Texas at Austin.

• The Housing Market is Booming in South Texas

• Demand has Greatly Exceeded Supply

• What do Builders/Developers do with this Housing Challenge?

• What do the cities of the area do in response?

• Where will all the people live?

• Housing Challenges in – Corpus Christi – Smaller towns near Corpus Christi – Smaller town in the Eagle Ford Shale area

Challenge 1

• Reduced Subcontractor Base

Challenge 2

• Corpus Christi is a Small Market

Challenge 3

• No Large Scale Developers

Challenge 4

• Costs Increasing

Challenge 5

• Appraisals

Challenge 6

• Lack of Land with Infrastructure

• Housing Challenges in Small Towns Near Corpus Christi – Ingleside, Aransas Pass

– All of Corpus Christi’s, but magnified, PLUS…

• Challenge – Opportunity Cost

• Housing Challenge of Small Towns in the Eagle Ford – They have the same challenges as Corpus Christi, PLUS…

• Challenge – Building a Sustainable Community

• Housing Solutions for Small Towns in the Eagle Ford

– That apply to Corpus Christi, as well as small towns near by

• The Local Government Can Facilitate the Solution – If the market was going to do it, it would have already done it

• The Government Can Do the Following – Collect market data to identify, for Builders and Developers, the market need

- Realtor Sales (MLS)- Building Permits- Population Growth- Job Growth

– Identify all the developable land – Extend utilities and streets to developable land

• The Government Can Do the Following – Work with land developers who have end users – Homebuilders

– Create Buyer Incentives, so purchasing is cheaper than renting

– Down Payment Assistance

– USDA Down Payment Programs

– Closing Costs Assistance

– Grants to Lower Home or Lot Costs

– Modular Homes

– Provide developer incentives to reduce long term risk

– Provide GAP Financing

• This Makes Sense Because Cities are the Ultimate Long Term Investor, and Want Economic Development

• Homebuilding is Economic Development

– Homebuilding creates jobs

– Homebuilding creates tax revenue

• The Tax Revenues Can be Payback to the City for its Developer Incentives

• A 2007 Study Done in Corpus Christi Showed the Construction of 100 Homes per Year Generated:

– $1.2 million in taxes & other revenue for local governments

– $12.6 million in local income

– 285 jobs• The Recurring Annual Impact of Building

those 100 Homes

– $748,000 in taxes & other revenue for local government

– $2.8 million in local income

– 71 local jobs

• In Conclusion

The challenges for housing are great, but a good solution for towns in the Eagle Ford is the Local Government facilitating Sustainable Growth.

Thank You

Questions?