Dallas June 2022 Key Take Aways!
Laila Assanie – Federal Reserve Bank of Dallas provided an economic update for Texas:
- Texas had recovered all its lost jobs by yearend 2021.
- Texas employment forecast to grow around 4% in 2022 – more slowly than in 2021, but still well above trend and the nation.
- Accelerated migration of people out of high-density, high-cost-of-living areas should continue to benefit Texas and boost overall growth.
- Even though the migration flow has been mostly in the DFW area, Austin is not far behind along with San Antonio and then Houston. El Paso and Corpus Christi.
- Supply-chain constraints expected to be a continued drag on growth.
- Price pressures likely to remain elevated.
- Geopolitical tensions and further outbreaks of COVID are also downside risks to the outlook.
- Texas exports reach new highs in April – Mexico is texas’ top trading partner, receiving around 30% of the state’s exports.
- The Labor Market remains “tight” indicating a lack of applicants and/or no applicants being the issue. Also, many potential employees are looking for more pay than what is being offered and lack of childcare as two reasons for the low numbers.
- Wage and price pressures surged in 2021 in Texas and are expected to remain elevated in 2022.
- Paul Hendershot with CoStar Group shared that the DFW metroplex has seen more growth in the commercial real estate market over the past 12 months than any other market in the country and its primarily multi-family, which continues to grow.
- Kimber Davison with Griffith Davison shared that many of her clients, who are regional developers as well as construction general contractors, are all dealing with a lot of ongoing issues which includes material shortages, higher construction and interest/lender issues, which “are the boiling pot for her clients”. There is an especially high demand regarding multi-family projects.
- Kimber also shared that many General Contractors are “scrambling to find places to store whatever materials they are able to get their hands and they need lenders consent in order to store the materials, but even that is difficult and extremely complicated to figure out”.
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