Texas MPC Rankings 2018: Top Performers and Results
Sienna Plantation in Missouri City, which increased sales from 372 in 2017 to 544 in 2018.
HOUSTON – (By Dale King, Realty News Report) – Houston does not have a master-planned community (MPC) in the national Top 10 of RCLCO Real Estate Advisors’ 2018 Housing and Community Preference Survey.
That said, the Bayou City more than makes up for that absence in several noteworthy ways.
According to the RCLCO report, Houston has more master-planned communities (11 total) and more sales within the national Top 50 MPCs than any other metropolitan area in the United States.
Sienna Plantation in Missouri City, Texas — which saw a 46% increase in sales in 2018 compared with 2017 — ranked No. 14 nationally, the highest placement among Houston-area MPCs.
Other Houston-area communities with substantial sales totals included: Bridgeland in Cypress, which grew sales by 14%; Cross Creek Ranch in Fulshear, ranked 25th with 15% sales growth; Aliana in Fort Bend County, selling 430 units versus 428 in 2017; Harmony in Spring, ranked 25th and maintaining sales at 425 units; Riverstone in Fort Bend County, ranked 35th with 15% growth; Woodforest in Montgomery, ranked 37th with 8% growth; The Woodlands, ranked 42nd with a 1% increase in units sold; Balmoral, ranked 43rd, which again sold 334 units; Lago Mar in Texas City, ranked 44th with 321 units sold; and Wildwood at Northpointe in Tomball, tied for 50th place with Wiregrass Ranch in Tampa, each selling 315 units.
“While some metros have one or two dominant, large-scale MPCs, Houston has numerous moderately sized and several large MPCs that in aggregate account for a large number of sales,” said Todd C. Larue, managing director of RCLCO.
“This large number of communities makes for a very competitive market, reducing any one community’s ability to achieve high-enough market share to make the top 10, though those with size, scale, and solid product segmentation strategies can likely achieve the top 10, much as they have in the past.”
Larue noted that The Woodlands and Cinco Ranch are two Houston MPCs that have previously ranked in the single digits nationally.
Despite steadily rising home prices and increasing mortgage interest rates, 2018 was generally a positive year for master-planned communities. The Houston–The Woodlands–Sugar Land metropolitan area represents 70% of the communities on this year’s Texas Top-10 list, according to the report.
“The Houston area continues to experience significant growth,” the report states, with expansion particularly strong in Fort Bend County to the southwest and increasingly in Montgomery County to the north. Major road projects, such as the Grand Parkway, have improved suburban accessibility beyond Houston’s central core.
Developers cite easy freeway access, a mix of reputable builders, social and recreational amenities, and high-quality schools as the primary drivers of sales in Texas’ top-selling communities. Even after extensive flooding in 2017 from Hurricane Harvey, sales remained especially strong in the northwest and southwest suburbs.
The survey shows that communities in the Dallas–Fort Worth–Arlington metropolitan area make up the remaining 30% of Texas’ Top-10 selling communities in 2018. Employment and household growth continue to push north of Dallas, concentrated along major corridors such as the Dallas North Tollway.
The Austin–Round Rock metropolitan area remains the third-largest market in Texas. Austin’s population continued to expand rapidly through 2018, in part driven by large technology employers increasing their presence in the region.
RCLCO’s report also identifies unmet demand for a broader range of home types and sizes than currently being supplied. Builders cite several reasons for their difficulty delivering lower-priced, entry-level homes.
“These findings, together with the observed decline in total sales among top-selling communities following the Great Recession, suggest that MPCs have an opportunity to diversify product types and home sizes to expand market share.” The study notes that MPCs that diversified their offerings consistently recorded the highest sales.
Successful communities often credit their market segmentation strategies — targeting a wide range of ages, incomes, and household types with appropriately priced and designed housing and lifestyle amenities — as a central factor in their performance.
RCLCO’s outlook for 2019 is more cautious. Average new home prices have risen by more than 50% since the recovery from the Great Recession (not adjusted for inflation), and together with higher interest rates, this trend is expected to slow the pace of sales.
Although economic growth may decelerate in 2019, most economists at the time did not predict a recession before 2020.
Consumer confidence remained relatively strong. When uncertainty rises, master-planned communities often benefit because buyers tend to view them as a safer way to protect home equity.
