Luxury Homes and Mansion Prices in Houston Tumble Amid Oil Price Route

High End Mansions & Luxury Homes Prices Tanking

Forward by Steve Dancer – Builder / Investor / Mentor

OPPORTUNITY!  Here we go again!  I was a young homebuilder and house flipper in the 1980’s when the last major oil bust hit. Yes there has been several other downturns but nothing like the 1980’s and now.  The 1980’s bust was much more signficant then in that Houston was so dependent upon the oil biz and mortgage rates rose to an all time high at 15% and higher. Today, standard rates are at about 4%.  It goes without saying that if rates were at 1980’s rates today, there would be real estate blood in the streets just like in the 1980’s even with a more diverse job and industrial base that Houston enjoys today.

How About That Opportunity:  While Mansion prices over $1 Million are falling steeply as clearly outlined in article below and as can be see at MLS Press Release and below,  the article below also mentions how mid level / blue collar jobs are dissappearing as well. These Mansion owners and mid level management home owners in the say $400K – $750K price range are finding themselves in deep trouble. Many homes are being marked down and sold well below neighborhood comp values which have a way of adjusting overall comps lower by sold prive gravity. Short Sale – Foreclosure – Deed in Lieu – Sub-to  – Wraps – Lease Purchase:  These are just a few of the techniques that can be used and are being used insteado of a traditional Realtor approach in order to help these sellers who are often times not in an equity position to sell outright with a traditional Realtor!


OPPORTUNITY YOU SAY!  A Huge Opportunity in the Luxury & Mid Luxury Space!  Do not be afraid of the $0’s. Yes Knowing how to market for and close Luxury Deals has it’s own nuances, they indeed are similar in some ways.  The Question remains however, who wants to make this money????  WE DO, WE WILL, HOW ABOUT YOU!!!  Even if you do not feel comfortable we do!  When you need a Mechanic, an A/C Contractor or Even an Attorney you call them!!!  Then Why Not call an Expert who can help you make money on Luxury Deals when you have those Leads????   No Problem!  WE CAN HELP!!!   A Slice of a very large pie is certainly better than no slice at all. Bottom Line:  Start looking and marketing for luxury deals. Keep your options and lead opportunities Diversified & Open. You will find a whole new world of income opportunities in the Luxury & Mid Luxury space.


Reposted Article:

Prices for mansions in Houston’s swankiest neighborhood have tumbled in lock-step with crude prices. The Houston Opera has offered free season tickets to patrons who lost their jobs in the oil bust. A fancy restaurant offers cut-price dinners.

Twenty months into the worst oil price crash since the 1980s, well-heeled residents of the world’s oil capital are among the hardest hit largely because tanking energy firm shares make up much of oil and gas executives’ compensation.

In River Oaks, a neighborhood of palatial mansions and lush gardens, the average sales price of a home has tumbled to $1.3 million from $2 million in the middle of 2014 when oil began its more than 70 percent slide, according to data from the Houston Association of Realtors and Keller Williams. Median property prices in the area have already fallen further in this downturn, which is not yet over, than the 16 percent drop in the previous oil slump in 2008 and 2009.

“When oil does well, River Oaks does well. When oil does bad River Oaks does bad,” said Paige Martin, a Keller Williams broker who specializes in the neighborhood. “Not everybody can afford a $10 million house.”

City-wide data also show that while overall sales of single family homes fell 2 percent in January, sales of those priced over $500,000 tumbled 9 percent. The overall median house price was $200,000, up 5 percent on the year, according to the realtors’ association.

While Houston’s economy is far more diversified now than in the 1980s when the city lost 13 percent of its jobs, it remains home to 5,000 energy-related firms and the fortunes of oil and gas executives are tied more than ever to the energy market.

Since U.S. lawmakers passed a law in 1992 encouraging “performance-based” pay, the share of stock options in executive compensation has steadily increased, said David Bixby, head of the Houston office for Pearl Meyer compensation consultants.

“Now, you’re looking at 70 to 80 percent of CEO compensation in stock on average for oil and gas companies,” he said. “They are going to be exposed to commodity price cycles.”


For example, former oil executive, Kolja Rockov, whose extravagant wedding with dancers and acrobats became a local online sensation three years ago, briefly put his unfinished mansion on the market for $6.9 million, according to listings. Work appeared to stall on his house as an SEC filing showed he involuntarily sold 239,000 shares of the company’s tanking stock he had used as a collateral for a loan. Rockov lost his job as Linn Energy LLC’s (LINE.O) CFO in August.

Rockov could not be reached for comment.

Luxury car sales are also slower in Houston than in other parts of the state and the country.

“If you’re working for an energy company, you see all this stress around you, it might nick your purchase confidence, even if you are fairly high income,” Earl Hesterberg, chief executive of Houston-based Group 1 Automotive Inc (GPI.N), told Reuters.

He said excess inventory was most acute for top line BMW (BMWG.DE) and Mercedes-Benz (DAIGn.DE) models in Texas and Oklahoma.

In a nod to the downturn, Ouisie’s Table, a River Oaks institution, is now offering its “Oil Barrel Bargain,” a three course dinner for the price of a barrel of oil, now around $30.

To be sure, oil executives are not alone in feeling the pain. Many blue collar jobs in oilfield equipment production have disappeared. So have thousands of middle management jobs in oil exploration and production. A regular Uber customer is likely at some point to ride with a former energy industry professional.

“It pays for the mortgage,” said Matthew Clemonds, who once did mapping for pipeline companies and now works for the ride-sharing company.

Job growth has slowed to a crawl from the breakneck pace of 100,000 a year during the oil boom; housing starts are down and subleasing of new office space is rising, according to government data and NAI Partners, a real estate consultancy.

But so far, owing to its diversity, the metropolitan economy has shown remarkable resilience, adding 20,000 jobs to just over 3 million last year.

For example, Houston is home to the Texas Medical Center, the world’s largest cluster of hospitals, research facilities and affiliated universities, which says it employs 106,000.

In the energy sector, about $50 billion being invested in new petrochemical plants to take advantage of cheap supplies is helping offset upstream job losses.

“This is the best oil price downturn we have ever had,” said Ted Jones, chief economist at Stewart Title Guaranty Company. “We still have more jobs than we have ever had in history.”

Bill Gilmer, a University of Houston economist, says so far it has paid off to tough it out through oil’s booms and busts and notes that ever since 1969 Houston has consistently ranked among the fastest growing U.S. cities.

“The only problem is that it can be a rollercoaster.”

Didn't Get an Answer to Your Questions?

Call us at 713-955-8953

Get an Offer on Your Home ~ or ~ Call Today! 713-955-8953

    4 Simple Steps to Sell a House As-Is in Days ~ Not Months

    Step 1

    Submit Form Above!

    Your Information
    Confidential & Secure
    We Are Licensed Pros!

    Step 2

    We Call You!

    Set a time to view your
    home asap at a day &
    time that works for you!

    Step 3

    No Obligation Offer!

    We Make a No Obligation
    Offer. No Repairs Reqd.
    Close on Your Timeline!

    Step 4

    If You Accept? - Sold!

    We Buy! Close Quickly! Close
    at Reputable Title Co. We Use
    TREC Contracts. You Get Paid$

    Any Price ~ Any Reason ~ Any Condition
    • Cash at Closing for Greater Houston TX Homes
    • |
    • Sell Your Home As-Is
    • |
    • 35 + Years Experienced House Buyer Investors