Real Estate Investors Say Bye to Houston, Hello to Salt Lake

(Bloomberg) -- Houston, battered by the oil slump and Hurricane Harvey, is taking yet another hit. The city is now 60th on a list of desirable U.S. markets for real estate investment, tumbling from the No. 1 spot it held just three years ago.

Salt Lake City and Fort Lauderdale, Florida, cracked the top 10 for the first time in the annual ranking by PricewaterhouseCoopers LLP and the Urban Land Institute. Seattle topped the list, thanks to its job opportunities, diverse economy and young, educated workforce, the researchers said in a report today. Manhattan dropped to 46th, from 13th last year, because of its high costs and oversaturation of construction.

Houston, the No. 40 market last year, is seen as more energy-dependent than other Texas population centers, Mitch Roschelle, a PwC partner, said in an interview. “The sentiment from the real estate community was there didn’t seem like there was enough catalyst from the oil industry to really bring back Houston to its glory days.”

Fort Lauderdale and Salt Lake City benefited from investors who saw those places as alternatives to higher-priced Miami and Denver, respectively. The Salt Lake City market is the smallest to ever make the survey’s top 10.

The poll of more than 1,600 real estate experts was conducted before Hurricanes Harvey and Irma. Here are the top 10 markets and their rankings last year (in parentheses):

1. Seattle (4)
2. Austin, Texas (1)
3. Salt Lake City (18)
4. Raleigh-Durham, North Carolina (7)
5. Dallas-Fort Worth (2)
6. Fort Lauderdale, Florida (35)
7. Los Angeles (5)
8. San Jose, California (17)
9. Nashville, Tennessee (6)
10. Boston (12)

©2017 Bloomberg L.P.