Is the Texas Economy in a Bubble or about to Blast off?

CNN Money is asking the question Is Texas America's Best State Economy?.

Lets just look at some facts:

• Last year the state (GDP) grew 5.2%
• 3 of the 5 fastest growing US cities are in Texas and 5 out of the top 20 (Houston, Austin, San Antonio, Dallas, and Fort Worth)
• Housing is undervalued (compared to rents)
• Unemployment is 4.2% compared to the national average of 5.5%
• The median income is $75,000 which is 20% higher than the national median
• Median home price is $243,000 which is higher than the US average, but with incomes so high, it makes housing very affordable.
• Forbes says Texas is the best place to invest in real estate because housing shortages + low real estate values + high incomes = real estate values will rise (appreciate)
• More Americans are moving to Texas than any other state because of jobs and affordable housing
• Strong or growing industries: tech, transportation, real estate, mining, manufacturing, textiles, food
• Weak? really just 1: oil & gas
• Texas is the best city for jobs with 4 cities ranking in the top 10
• Huffington says its time to buy a house now

Most recent updates

6/26/15 - Texas is up 4% over 2014, making records, still the fastest growing in the nation despite suffering in the energy sector. They believe we're not in a bubble and still predicting record highs. Builders are focused on high end.

6/30/15 - Statistics show Texas real estate appreciates at 8.8%

8/14/15 - This report is from June, but I wanted to list it. The source is here:  http://recenter.tamu.edu/econ/

I could go on and on. The fact that Texas is considered the best place for investors (ie bottom feeders) to buy real estate is enough for me to feel confident that things are looking up. The investors aren't getting wild discounts on properties, they just know that today's high prices will look low compared to what home values will be in the near future.

The only thing that points toward a bubble is the rate at which real estate is appreciating, however according to all of the other metrics, the appreciation is warranted. In fact, its long past due and should continue for some time. It may not keep up the same pace, but house prices will continue to climb.

One thing to be aware of... news outlets will begin reporting on "slowed appreciation" and make it sound like we're crashing. When you hear the alarmist reports just keep in mind: slow appreciation is still appreciation.

If home values begin to depreciate keep a sharp ear opened for the actual rate of depreciation. Make your decisions based on the facts and do your best to ignore the noise.

Lets enjoy the fun ride.